Financial News

  • 15 April 2014, 7:24

Second-hand Car Dealer BCA Gears Up For Float

Britain's biggest secondhand car auctioneer is poised to join London's stock market flotation frenzy after hiring bankers to work on a deal.

Sky News has learnt that the private equity firm Clayton Dubilier & Rice (CDR) has appointed Rothschild to prepare British Car Auctions (BCA) to make its debut on the public markets later this year.

BCA, which describes itself as "Europe's leading vehicle remarketing business", is expected to be worth well over 500m, as its owner seeks to exploit the buoyant state of the UK car market.

The company has been owned by CDR since early 2010, when it was bought from Montagu, another private equity firm.

A sale of BCA remains a possibility, although a flotation is the preferred option and further banks are expected to be appointed to work on the listing by the summer, an insider said.

The exact timing of a flotation will depend on the extent of any ongoing equity market volatility relating to factors such as the crisis in Ukraine, which on Monday was a cause of weakness across European share markets.

So far in 2014, dozens of companies have announced listings in London, with retailers such as Pets At Home and Poundland and a series of technology companies among those coming to the stock market.

BCA had a record year in 2013 with sales of more than 600,000 vehicles for the first time, with an average price of just over 7,000, up 14% on the year before.

Based in north London, BCA recorded a pre-tax profit of 30.4m in 2012 on sales of 262.5m.

At its first auction in 1946, when it traded as Southern Counties Car Auctions, the company sold 14 cars and generated proceeds of 2,300.

It now sells more than 12,000 vehicles every week at physical auctions and over the internet.

A CDR spokesman declined to comment.