SIR Arnold Clark yesterday confirmed he had expanded his Scottish car dealership empire with the purchase of BMW and Mini specialist Harry Fairbairn, in what is almost certainly a multimillion-pound deal.
The Herald revealed last week that Arnold Clark was poised to acquire Harry Fairbairn, which has dealerships in Giffnock, on the south side of Glasgow, and Irvine in Ayrshire.
Sir Arnold has decided, rather than trading the acquired business under his eponymous company's name, to retain the Harry Fairbairn brand. Arnold Clark, Scotland's biggest private company by turnover, also pledged to retain Harry Fairbairn staff.
Confirming yesterday's completion of the purchase of Harry Fairbairn, Glasgowbased Arnold Clark said in a written statement: "The directors of Arnold Clark Automobiles are pleased to announce that they have completed negotiations to acquire Glasgow and Ayrshire-based motor dealer, Harry Fairbairn Ltd. The company will remain trading as Harry Fairbairn Ltd and will continue to represent BMW and Mini with the same level of competence and members of staff."
Sir Arnold, who remains executive chairman of the company which bears his name, welcomed the addition of two new marques to his network of dealerships.
He said: "I am delighted to have the opportunity to represent BMW and Mini."
A spokeswoman for Arnold Clark said the company "occasionally" retained the name of businesses acquired, and this was not the first time.
"Every circumstance is different, " she added. "It is a good business. Occasionally, we have (had) other brands we have kept the names of."
The purchase price was not disclosed yesterday, and the spokeswoman declined to reveal it.
However, taking Harry Fairbairn's last published annual pre-tax profits figure of GBP910,671 for 2004 and applying the normal range of price-earnings multiples, it would almost certainly run into millions of pounds.
The successful BMW and Mini dealer was owned by Ronnie Henderson, who has run the business, fellow director Tom Preston, and Margaret Fairbairn, widow of the late founder Harry Fairbairn. Its Giffnock operation occupies a huge corner site on Fenwick Road.
Harry Fairbairn's accounts show it increased turnover to GBP54.4m in 2004, from GBP53m in the prior 12 months. Pre-tax profits rose from GBP886,572 to GBP910,671, and the underlying increase was even bigger because the 2003 result was boosted by a VAT repayment of GBP261,253, net of professional fees.
The 2004 accounts show Harry Fairbairn employed an average of 141 people during that year - 53 in selling and distribution, 64 in administration and 24 mechanics.
SirArnold has achieved massive growth in his business, both organically and through acquisitions. He said last week, ahead of the completion of the Harry Fairbairn deal, that he had about 7400 staff and some 130 dealerships. The vast bulk of these dealerships are in Scotland, although Sir Arnold said he now had "approaching 30" south of the border.
Arnold Clark last year defied the depressed new car market and the collapse of MG Rover to post a rise in underlying full-year profits.
It reported operating profits excluding goodwill and exceptionals of GBP64.8m for 2005, up from GBP61.5m in the previous 12 months. Sales at the company, founded when Sir Arnold bought his first showroom nearly 50 years ago, climbed 4.9per cent to GBP1.7bn.
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