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- Cash Converters International (CCV) is looking to take over its largest UK franchise group, Capital Cash, in a ₤13.9 million (A$24.7 million) deal
- The two businesses on Monday announced the execution of a sale and purchase agreement for CCV to take full control of Capital Cash
- Cash Converters is currently the ‘Master Franchisor’ to 188 stores in the UK, of which Capital Cash is the largest group of stores, operating 42 franchises
- The deal is expected to complete in mid-2023, subject to approval from the Financial Conduct Authority in the UK
- Shares in Cash Converters are trading at 23.5 cents at 11:21 am AEDT
Cash Converters International (CCV) is looking to take over its largest UK franchise group, Capital Cash, in a ₤13.9 million (A$24.7 million) deal.
The secondhand retail company on Monday announced a sale and purchase agreement for CCV to take full control of Cash Capital, with the purchase price valuing the UK business at up to 4.8 times its 2022 financial year earnings before interest, tax, depreciation and amortisation of ₤2.9 million (A$5.1 million).
Cash Converters is currently the ‘Master Franchisor’ to 188 stores in the UK, of which Capital Cash is the largest group of stores, operating 42 franchises.
This acquisition is part of CCV’s strategy to acquire “value-accretive franchise store networks”, and the company said it would establish a corporate base to oversee its wider European operations.
Cash Converters Managing Director Sam Budiselik said the company was excited to acquire its largest franchise store network in the UK and to integrate a “proven management team” into its corporate operation.
“I would like to take this opportunity to thank the Capital Cash team for the investment made in establishing our brand in local markets over twenty years, as we now look forward to consolidating and growing a corporate network of stores across the UK,” Mr Budiselik said.
The purchase price will be funded using CCV’s available cash reserves and will be immediately earnings-accretive, with the acquisition expected to complete in mid-2023.
The final settlement is subject to certain conditions, including regulatory approval by the Financial Conduct Authority in the UK.
Shares in Cash Converters were trading at 23.5 cents at 11:21 am AEDT.
