By Ilaria Grasso Macola
Halfords has bought commercial tyre firm Lodge Tyre for £37.2m in cash, the motoring services retailer announced today.
The London-listed company will pay an initial £33.2m while a further £4m will be paid in FY25 depending on performance.
“The acquisition of Lodge Tyre is yet another example of Halfords’ strategic aim of becoming a motoring services-focused business, and will mean that Motoring accounts for over three quarters of our total revenue,” commented Halfords chief executive Graham Stapleton.
The takeover will in fact take Halfords garage services business to 656 garages, 253 consumer vans, 440 vans and 9 warehouses.
Upon completion, revenue coming from garage services will increase to 48 per cent of group revenues, up from 26 per cent in 2020.
“The current trading environment reinforces the rationale for building ever-more resilient, needs-based revenue streams, which is exactly what the motoring category offers,” he added.
Commenting on the announcement, Hargreaves Lansdown’s head of equity research Darren Nathan said the takeover’s price was fair.
“Halfords’ manageable debt levels allows it to make modest acquisitions without asking shareholders to pay up, with today’s deal being funded from the balance sheet,” he added.
Shares went up by 7.8 per cent on Wednesday afternoon.
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