Transport hire company Northgate has confirmed that it is looking to make a major acquisition, just over six months after a merger with another player in its sector.
The Darlington firm merged with fleet management specialists Redde in February and has now confirmed reports that it is in talks to take over Oxfordshire-based Nationwide Accident Repair Services.
Nationwide has a network of repair centres around the UK and deals with more than 300,000 repair incidents each year. In the North East, it has sites on Gateshead’s Team Valley, as well as at Durham and Middlesbrough.
Redde Northgate said the potential takeover would be a “good strategic addition to its business”, and that if it went through, it would be funded by existing cash resources.
If successful, the deal would add turnover of more than £300m and staff of almost 4,000 to Redde Northgate, which said at the time of its merger that it was set to become a £1bn business.
A statement from the company released to the Stock Exchange said: “Redde Northgate plc, the integrated mobility solutions provider, notes recent media speculation about its interest in Nationwide Accident Repair Services.
“The company confirms it is in advanced discussions about a possible transaction involving Nationwide Accident Repair Services. The group believes the network of body shops and customer base would be a good strategic addition to its business.
“There can be no certainty that a transaction will be entered into, nor the terms of any such transaction. If a transaction does take place, it will be funded through the group’s own cash resources. A further announcement will be made when appropriate.”
In its most recent trading update - issued in May - Redde Northgate said that trading up to February had been in line with expectations, but the Covid-19 outbreak had impacted on revenues in March and April.
The company took advantage of the Government’s Job Retention scheme to furlough some employees and also limited all non-essential spend and capital expenditure.
The company is due to release preliminary results later this month.
