Kidder Williams has pumped the accelerator on a sale process for private smash repair group Western General Bodyworks (WGBW), kicking off talks with private equity funds and other potential buyers.
The accident repairer, based in Victoria, has 11 workshops, more than 170 staff and services north of 10,000 cars a year, according to a flyer shown to potential investors.
WGBW was established in 1981 with one workshop in Maribyrnong and now has locations across Melbourne, Geelong (where it is the biggest collision repairer), Newcastle and Gold Coast, repairing cars for insurers including IAG Group, Allianz, Suncorp and Youi.
The group’s owned by businessman Danny Buzadzic, who has 30 years in the vehicle repair industry, and a bunch of acquisitions in the pipeline to try to grow the business and its footprint.
It also recently launched businesses including M Tech Suspension and Motor Glass Windscreen, which provide aftermarket repairs and were said to be on track for positive earnings in FY23. [The businesses were started in the past two financial years].
With all the expansion plans, Buzadzic has hired Kidder Williams to go shopping for a new owner that could help fund it all.
The five-page pitched, sent to potential acquirers this week and seen by Street Talk, looks like a direct call to cashed up PE funds looking for places to deploy their dry powder.
PE funds have sniffed around Australia’s smash repairs sector in the past – Blackstone even had a deal to acquire AMA Group’s panel repairs arm which fell over – with thoughts about consolidating what’s still a fragmented market.
WGBW’s small compared to AMA’s business, and looks like one for the growth funds. It turned over jobs worth $33.9 million last financial year at a double-digit EBITDA margin, the flyer said.
Revenue is heavily skewed towards workshop repairs (91 per cent), and about 60 per cent of its work is insurance jobs.
The flyer said WGBW’s owners were considering their strategic options including a full sale of the business. They hired Kidder Williams to run Project Optimus and test buyer appetite.
The advisers have started drumming up interest, keen to point out that WGBW got through the pandemic better than plenty of its rivals, winning industry awards as the best multi-site operator.
It comes as the biggest buyer (and player) in the sector, AMA Group, implements new pricing deals with insurers and engages in “network optimisation” to try to turn around its fortunes, after expanding rapidly in the past decade. Its biggest move was acquiring Suncorp’s Capital Smart repair business for $420 million in 2019.