At the time, Ford paid a reported £1 billion for the fast-fit chain, then headed by Sir Tom Farmer, as part of the manufacturer's bid to create a 'showroom-to-scrapyard' service. Ford will now record a one-time after-tax charge of approximately $500 million related to the sale of Kwik-Fit, signalling a major about turn in its strategy in order to stem massive losses in its core operations.
Ford jettisoned its controversial chief executive Jac Nasser last year, with William Clay Ford Jr taking the helm. He signalled a 'back to basics' approach to the future of Ford, reversing Nasser's push to turn the firm into a broader 'automotive services company'.
As a result, Ford put non-core assets up for sale, including Kwik-Fit, but it immediately became clear that bids would not match the price Ford originally paid. The final £330 million deal is a significant shortfall on the purchase price Ford paid for the business, but by retaining a 19% share of the business, Ford intends to reap the benefits of any improvement in Kwik-Fit's value in future.
Future Kwik-Fit chairman Sir Trevor Chinn said: 'No-one can judge where the value of the company will return to. We have a great brand and we are very positive about what the future holds.'
It is understood that Kwik-Fit founder Sir Tom Farmer will not be part of the sale agreement once the deal is finalised.
Martin Inglis, Ford group vice president, business strategy, said that although Kwik-Fit was a good business, it didn't 'align with our back-to-basics strategy'. Ford has also announced it does not intend to pursue the sale of Hertz Equipment Rental Corporation (HERC).