Halfords has acquired a chain of garages for £62 million, as it continues to invest in the automotive side of its business.
The UK’s largest motoring and cycling retailer has bought the Axle Group, owner of the National garage chain, adding 239 tyre and 60 general services garage, and 60 mobile tyre-fitting vans to its network.
Last year, Halfords announced plans to close all its 22 Cycle Republic high street cycle stores and the Boardman Performance Centre, to free up money to focus on motoring.
The move put 226 jobs at risk, before electric scooter retailer Pure Electric stepped in to take ownership of 11 Cycle Republic stores, saving 85 jobs in the process.
On the latest acquisition, Halfords chief executive Graham Stapleton said: “This acquisition helps cement our position as the UK’s largest vehicle service, maintenance and repair business.
“It will also see us deliver on our established strategy of evolving Halfords to become a motoring services focused business, with motoring revenue set to represent more than 70% of our pro-forma revenue following the acquisition.”
After completion, Halfords will own 604 garages, 234 consumer vans and 190 commercial vans nationwide.
Halfords plans to invest £17 million in the overall business and spend £2 million on integration costs. The company raised £63.4 million of gross proceeds by placing shares with investors at 320p each.
Following the announcement, Halfords shares rose 6.6% to 341.1p.
Last month, the retailer upgraded its full-year 2022 profit guidance after a strong first-half performance.
Halfords saw revenue grow by almost 20 per cent on its full-year 2020 figures, thanks to an 88 per cent increase in its Autocentre divisions.
The company now expects profits of £80-90 million for 2021, up from previous guidance of £75 million.
Announcing the upgrade, Stapleton said: “We are delighted to have delivered a strong H1 performance, driven by market share gains in motoring products, garages and our mobile services business, which now account for more than two thirds of our revenue.
“There is good momentum in our existing business, the strategically important area of motoring services continues to grow strongly, and our recent acquisitions are all performing well. As a result, despite the challenging trading environment, I am very excited about our future growth prospects.”