Motorczar provides automotive services including strategic planning, mergers and acquisitions advisory, management due diligence, restructuring, turnaround, and interim management. The company has experience advising automotive businesses, manufacturers, dealerships, and other supply chain entities. Motorczar offers diagnostic tools such as an automotive health check and funds generation analysis to evaluate clients' operations and financial position.

1. Motorczar Ltd
- overview of services
Contact: Sid Hopper
Tel: +44 77887 822348
Email: sid.hopper@motorczar.com 1

2. Automotive Services
Our dedicated automotive service offering
Motorczar is dedicated to the Automotive sector – this covers the
entire supply chain from component and sub assembly producers
through to franchised garages, independent garage operations,
fleet, vehicle repair, and the aftermarket.
Our industry knowledge means we have a full understanding of
your business and we are better placed to assist you.
We offer a range of services including:
• Strategic planning and implementing change
• Sales, acquisitions and due diligence
• Management due diligence
• Post transaction support
• Dealer health checks
• Dealer performance improvement
• Restructuring, operational and financial
• Contingency planning
• Working capital improvement
• Accelerated M&A
• Turnaround
• Interim management
• Non-executive appointments.
© Motorczar

3. Overview Of Motorczar Core Services
Performance Improvement
Transaction Services Restructuring Services Other Advisory Services
Services
• Sell side advisory work • Strategic support to dealers • Interim management. • Post transaction support.
including the management of and dealer groups plus
• Preparation and sale of • Non-executive appointments.
disposal of businesses. implementation of action
insolvent Companies using
plans. • Independent business
• Buy side advisory work UK Insolvency law.
reviews.
including assisting with • One day reviews to identify
• Advice on foreign
Management Buy Outs, third issues to be addressed and • External stakeholder
restructuring regimes.
party acquisitions and review options. stabilisation and
company mergers. • Implications of insolvency management.
• Automotive health check of
law on directors,
• Vendor and/or purchaser dealer operations. • Debt advisory work including
manufacturers, customers
financial due diligence. balance sheet restructuring,
• Management due diligence and suppliers.
solvency and security
• High level commercial due and improvement.
• Advice to creditors of reviews.
diligence.
• Operational and financial insolvent companies,
• Contingency planning to
• Cash and stakeholder turnaround. including asset recovery.
ensure continuity of
stabilisation of distressed
• Third party assurance • Orderly wind downs, solvent operations.
businesses.
reviews to validate business and insolvent.
• Independent thought
• Accelerated M&A, solvent projects for stakeholders.
• Debt collection services of a leadership and research.
and insolvent.
• Working capital management Company’s receivables
• Organisational and strategic
• Supporting CF transactions and improvement. ledger.
change both company and
through commercial and
creditor side.
sector knowledge.
• Refinancing of operations
and/or vehicle stocks.
© Motorczar

4. Where Have We Done It Before?
Colebrook &
Barons BMW Berry BMW Newtown UK OEM Tom
Richard Rees Caddick
£ undisclosed
Burgess M&A of a
Accelerated Vehicle Rentals Restructuring advisor to Walkinshaw
Alexander Garages Systems
Acquisition of
manufacturer looking to Group Limited
circa £140m t/o dealer
Bank exposure c£6m.
group based in SE
Advisor to the MBI team on Restructuring advisor to
consolidate its downwards
Racing
Distressed M&A of £168m Distressed M&A of VW
their acquisition of certain VWFS. t/o dealer group following dealer group with t/o of
Restructuring and
England. of the West London BMW
supply chain. Restructuring advisor to
vehicle stock fraud of £20m
£50m.
turnaround advisor to Other syndicate lenders management team facing
Businesses and assets operations of HR Owen Identified critical issue in c£4m.
AM100 dealer group with
Plc.
had cumulative exposure
restructuring plan thus issues resulting from: Bank exposure Garic Ltd
Acquisition of c£2m, bank
were sold to Group 1 of c£96m.
t/o of £90m following Bank exposure £8m+, fully repaid.
generating sufficient mitigating a potential • failure of Arrows Formula
unexpected losses of Deal size undisclosed bank fully repaid.
proceeds to pay all Recommended support to £26m liability. 1 team; and
£1.4m.Turned around to
creditors in full and mitigate potential losses
profits of £0.4m within 12 • a downturn in its
provide for a return to to all vehicle lenders.
months. engineering business.
shareholders.
Dixons Motors Derek Woodman TRW John Fox
£ undisclosed Audi SW
£ undisclosed Prestige Dealer
£ undisclosed
Risk advisor to European Bank exposure Systems
Acquisition of c£3m CF and turnaround advisor
Acquisition of Systems Review of newly opened
Acquisition of Systems
purchasing team Group Limited to two Limited loss making
Group heavily operation in a statement
Group Limited
Bank exposure of c£24m. Solvent sale of an Turnaround advisor with
controlling a budget of VW/Audi dealer groups, site. Bank exposure £3m.
underperforming specific remit to improve
Lead member of team
BMW/Mini business
$8bn per year. £20m
short term cash flow £20m
both banked by RBS. £20m
As a result of the review
responsible for pre- Exposure c£6m.
resulting in full Project involved traning forecasting of Garic Ltd
Acquisition and working Acquisition of Garic Ltd we negotiated Garic Ltd
Acquisition of additional
receivership planning,
repayment to the Bank, in risk management and capital management. Project involved merger financial and operational
liaison with OEMs & stock
exposure c£4m. implementation of Improvement of £2.5m in of both businesses and support from the
funders, plus advising on
procedures within the eight weeks. acquisition of another to manufacturer.
business sale.
business form a market area, plus
We also worked with the
refinancing. Bank fully
dealer to identify cost
repaid.
savings and efficiencies.
© Motorczar

5. Where Have We Done It Before?
Sandicliffe Georg von Opel
£ undisclosed MG Rover
£ undisclosed Volume Multi Donovan Motorhouse
Multi-franchise dealer Restructuring advisor to
Acquisition of Systems CF and restructuring
Acquisition of Systems Franchise Restructuring advisor to
group t/o £175m. IBR and Adam Opel AG. Exposed
Group Limited advisorLimited
Group to SAIC. UK prestige dealer group.
Review of the business for Restructuring advisor to
restructuring advice with to German dealer group.
Project involved Bank, exposure £4m+, Project involved independent used car
specific emphasis on cash £20m
Project involved cash £20m
reviewing and operations in Basingstoke, stakeholder management, operator.
forecasting and
management and Ltd
Acquisition of Garic commenting on the MG
Acquisition of Garic Ltd Loughborough and facilitated sessions with
management. As part of the project
reviewing the German Rover restructuring plans Coalville. director/managers of
used stock funding was
Bank working capital restructuring plan as part of a negotiation of business, creation and
Key challenges were reduced from £12m to
forecast exposure of £8m submitted by accountants a potential joint venture. implementation of
under utilisation of sites £7m.
reduced to £4m. to support an insolvency. turnaround plan.
and uncertainty regarding
As a result of our work
future of GM Europe.
insolvency was avoided.
Richard Pontiac Coil Aston Green £ undisclosed Project Burger
£ undisclosed Project Team
£ undisclosed
Alexander Restructuring advisor to 24 month project Investment by Fresca
Acquisition of Maven Advisor to global
Acquisition of Systems Advisor to global
Acquisition of Systems
US parent and PNC Bank including post acquisition Capital Partners in John
Limited automotive company on
Group Limited automotive company on
Group Limited
Distressed M&A of £168m
based in Detroit. Parent support, IBRs, cash flow McGavigan Limited to its potential distribution future changes to the
t/o dealer group following
vehicle stock fraud of
was guarantor to bank of
+$1.2m of UK liabilities.
f’csting and management, finance setting up of £20m
strategies within the EU £20m
management assessment
negotiating OEM support, Chinese production programmes for future
c£4m.
Worked to create and recruitment, turnaround facility Acquisition of Garic Ltd dealer candidates Ltd
Acquisition of Garic
Bank exposure £8m+, and eventual sale of
implement closure plan
bank fully repaid. business. Bank exposure
which reduced actual
liability of parent to c£3m, fully repaid.
under $100k.
© Motorczar

7. Appendices
- AutoLite and Business Change
© Motorczar

8. Our approach – AutoLite
Stakeholder Desktop Site Visit Options & Next
Briefing Steps
 High level review of historic  Meet with dealer to obtain
 Obtain background from OEM results including this year’s background and understand their
 Set out summary of key findings,
 Understand key observations, management figures issues and agenda
conclusions, options and
issues and OEM agenda  High level review of forecasts  Demonstrate our industry implications in agreed format
 Identify other key stakeholders knowledge and track record
 High level review of cash  Agree with management the key
and potential agendas generation/ absorption  Discuss other key stakeholders facts and conclusions
 Agree basis of communication and understand their agendas
 Send out automotive healthcheck  Recommendations to OEM and
with management and other for completion by dealer prior to  Discuss key facts and conclusions next steps
stakeholders visit from desktop review
 Follow up with dealer, where
 Agree objectives and  Identify any potential influential  Review findings of automotive agreed
deliverables stakeholders healthcheck
 Agree scope, price and timing  Review in the light of industry  Discuss management/ shareholder
knowledge of the sector in terms of agenda
performance, location and brands
 Discuss options to be considered
 Identify potential next steps
8
© Motorczar

9. Our approach – Business Change
Phase 1: Initial meetings to planning: £1k per day Phase 2: Business change
OEM Briefing Management Diagnostics & Options & Implementation
Meeting analysis Action Plans
 Meet with OEM to  Meet with businesses  Industry and service  Management Project management,
obtain background to obtain background line expertise meeting(s) and/or support and assistance,
and understand their workshop as required
 Understand key  Benchmarking analysis
issues and agenda
observations, issues and  Agree facts,  Management initiatives
 Automotive health-
OEM agenda  Demonstrate our conclusions, options and and implementation of
check tool
industry knowledge and implications plans
 Identify other key
track record  Funds generation
stakeholders and  Current state/ future  Measurement and
potential agendas  Discuss value to  High level manage- state analysis regular review
business of our co- ment analysis
 Agree basis of  Discuss proposed  External stakeholder
operative approach
communication with  Identify action and actions, solutions, and support and assistance
management and other  Discuss other key measures that matter recommendations with
 Engage and manage
stakeholders stakeholders and OEM
 Options to be external consultants
understand their
 Agree objectives and considered  Engage with other
agendas  Rolling process for
deliverables stakeholders as needed
 High level manage- improvement
 Agree timetable and
 Agree scope, price and ment debrief  Agree action plan and
access to key people  Non-exec
timing of Phase 1 responsibilities
and sites  Verbal update to OEM appointment, if required
 Agree process and  Identify any external
frequency of regular input, as required
feedback
© Motorczar

10. Appendices
- Example outputs and tools
© Motorczar

11. Outputs
- summary of key facts, conclusions, options and implications
Key Features
 Focuses on the key issues and draws
conclusions
 Looks at all the relevant options available
and the implications
 Can be co-developed with management to
build consensus or used as a summary at key
points in the project
 Leads to consensus and the formulation of
robust decisions
Benefits
 Focusing on the key issues reduces
increasing clarity of decision making
 Management consider all the relevant
options and not just those in their comfort
zone
 Reduces the risk of disagreement between
management and/or key stakeholders
 Demonstrates thought processes
 Assists with developing the best solutions
for the business
 Defines the next steps
© Motorczar

12. Diagnostic tools
- Automotive healthchecks
Key Features
Automotive Retail Healthcheck
 Developed from over 12 years experience of advising automotive
businesses
 Electronic input, objective Yes or No answers
 Captures non-financial warning sign as well as financial risks
 Management can complete questions as well as Motorczar or
stakeholder staff
 Can be modified to provide a be-spoke risk tool for stakeholders
and stock funders
 Effective graphical output
Benefits
 Quick to complete, circa 1 hour. Management can complete and
return prior to commencement of work
 Comparison of Motorczar and management results enables a quick
discussion of key risks and challenges to the business
 Underlying analysis provides quick identification of key areas
requiring further focus and investigation Risk A No apparent cause for concern.
Risk B Some limited areas need improvement.
 Quick identification of key issues provides for early consideration Risk C There are serious areas of concern that need to be addressed.
of the options to be addressed Risk D Unacceptable level of risk.
© Motorczar

13. Outputs
- Funds generation
Sources & Uses Of Funds £'000 £'000
Key Features
Profit before tax 365
 Analysis of the ability of a business to generate sufficient funds Add: Depreciation 200
from operations to finance: 565
Less:
 actual or future capital expenditure
CAPEX 120
 loan and HP capital; and Loan Capital Repayments 600
HP Capital Repayments 86
 tax on previous year profits; and Tax Paid 165
971
 movements in working capital Funds Generated / Absorbed (406)
 In the example opposite the business generate insufficient funds
Financed by:
depending on working capital movements for finance which are not
sustainable in the short to medium term
(Increase)/Decrease in
Benefits Debtors 100
Vehicle Stocks 350
 Objective; based on an analysis of management information and Other Assets (59)
forecasts 391
Increase/(Decrease) in
 Stresses the importance to management of cash and working
Trade Creditors (31)
capital performance
Crown Creditors 367
 Readily identifies undercapitalised businesses which potentially Net Stocking Finance (280)
require an injection of cash Other Liabilities (41)
15
 Provides a tool whereby management can readily identify how 406
profitable a business needs to be to be viable
© Motorczar

14. Workshop tools
- Current & future states
Key Features
 Completed with management during the change
process, can be in a facilitated session The Current and Future State of the Troy site
 Includes: Future state
Barriers/Issues Brand/OEM
 an assessment of the current state of the Current state •
•
Hyundai: As described.
Citroen: Good product lines; supportive OEM; favourable
business to include financial and non-financial
Brand/OEM finance/stocking terms. Provides good throughput for size of
• Hyundai: Seen as being brand for future; good product;
• Two year termination site.
supportive manufacturer. for Suzuki and costs of
matters • Suzuki: Seen as being brand to terminate; bad product
line; unfavourable finance/stocking terms; unstable
exit
• Need to move
Property
organisational structure. • Double Showroom:
Hyundai into smaller
 a strategic view of the business in the medium
• Citroen in larger showroom
part of showroom
Property • Hyundai in smaller showroom
• Need to estimate, • Both areas complying with manufacturers’ brand identity
to long term
• Double Showroom in good location:
refurbishment, requirement.
• Hyundai in larger showroom
restructuring and
• Suzuki in smaller showroom disruption costs.
• Showroom requires investment to meet Manufacturer People
 can include stakeholder needs and agendas standards • Need to work out
financials for new site,
• Clear leadership with agreed responsibilities and reward
measures.
plus operational plan, • Culture of not accepting underperformance
People
 enablers and barriers to success identified
and negotiate with • Dedicated new car, used car and aftersales teams
• Overall, site lacks leadership and direction Citroen
• General sales manager ineffective leader and unable to
motivate staff. Sales team un-focussed. Need used car • Need to exit Processes and Reporting
people. underperformers • Management team focussed on driving through efficiency
• After-sales manager developing within role, impact seen improvements
in increasing financial performance. Technicians un- • This is a turnaround
• Sales staff keeping DOC up to date and accurate to enable
motivated and performing below par which takes focus and
Benefits
more efficient monitoring of KPI’s
time, will make losses
• More focus on using KPI’s to drive efficiency improvements
Processes & reporting initially to be funded
• Sufficient KPI’s produced
• Monthly meetings to discuss KPI’s Financial
• DOC system not always kept up to date by sales staff • Both brands and site profitable, well placed to whether
 Provides focus to management on strategic issues
• Management currently suffering from a lack of direction downturns and take advantage of good trading periods
• New, used and aftersales performing strongly compared to
industry averages
affecting or which will affect their business
Financial
• Producing a at least a 2% return in terms of PBT.
• Both brands loss making. Total turnover £23.8m, loss
£0.5m split equally between brands. Performance
deteriorating in terms of losses
Enablers
 Co-developed process assists with buy-in to the • Cars sales a key issue. Service absorption has improved
from 40% to +60% recently but needs to be sustained.
solutions needed • Liquidity to invest in Troy following VAT refund • Manufacturers may give financial support for representation • Ability to transfer of senior management from Hill to focus on Troy
• Citroen/ Hyundai acceptance to multi-franchise, Citroen have confirmed that • Need to change is recognised • Service is improving following senior changes last year.
 Identification of enablers and blockers allows
location is open but with existing car parc
• Can move good Citroen people from Hill to replace underperformers
• Could create temporary facility for Suzuki if necessary
management both to identify strengths and remove
potential obstacles to change
 Business position and direction fully challenged
© Motorczar

15. Motorczar Ltd - Sid Hopper
Sid is a global automotive components and retail
specialist based in the Midlands. He spends 100% of his The following is an example of some of the
time servicing automotive clients and has over 16 years automotive manufacturers, banks and stock funders
experience acting as a business advisor. Sid has worked with:
He acts as an advisor to Manufacturers, Component  Adam Opel AG
Suppliers, Dealers, Banks, Specialist Banks and  Audi
Shareholders. His work includes:  Barclays Bank
 Bentley
 Working with buyers and sellers of automotive operations  BMW
and businesses, including distressed M&A  BMW Financial Services
 Capital Bank
 Assisting Banks and stock funders in identifying and  Ford and Ford Bank
supporting at risk dealer operations  General Motors (Global)
 General Motors (Europe)
 Financial, operational and working capital turnaround of  Honda
Sid Hopper dealer sites  Lombard
Automotive Specialist  Lloyds Bank
 Working with manufacturers to set up and support new  Lloyds Blackhorse
Mobile: +44 (0)7887 822348 dealers, usually as part of a manufacturer sponsored dealer  Mazda
programme  Mercedes Benz
Email: sid.hopper@motorczar.com
 MBFS
 Working with dealers to improve the financial  RBS
performance of their operations  Renault
 Santander
 Working capital improvement and refinancing of  Shanghai Automotive Industry Corporation SAIC
automotive operations  Skoda
 Seat
 Providing strategic advice on real estate strategy  Volkswagen
 Volkswagen Financial Services
© Motorczar

16. Confidential
Not to be produced in whole or part without prior written consent.
Copyright ©2010
Copyright ©2011 Motorczar Ltd t/a Motorczar
Motorczar Ltd
Contact: Sid Hopper
Tel: +44 77887 822348
Email: sid.hopper@motorczar.com 16