The Ford Motor Company has announced today it intends to sell Kwik-Fit, it’s European maintenance and light repair business.
CVC Capital Partners, a leading European private equity group, intends to sign an agreement to purchase Kwik-Fit for £330 million (about $500 million) in cash and a note that will be paid as CVC obtains outside financing.
The proposed transaction will be completed using a new company formed for the purpose, and financed by funds under the management of CVC. Ford will retain a 19% equity interest in the new company to ‘benefit from the business’s future growth’.
The sale is expected to be completed in the fourth quarter of 2002 and is subject to regulatory approvals. Ford will record a one-time, after-tax charge of approximately $500 million in the third quarter of 2002 related to the sale.
In addition, to the Kwik fit deal, Ford has completed the sale of Collision Team of America (CTA), a US-based chain of collision repair shops. Daniel Hall, a private businessman, has agreed to purchase 100% of the stock and assets of CTA and will operate the business along with his spouse, Rhonda Hall. The sale of CTA was completed on July 31, 2002.
Ford has decided not to pursue the sale of Hertz Equipment Rental Corporation (HERC) at this time.