Acquisition of Marshall Leasing by BOIUK will ‘open doors’ to growth

Bank of Ireland UK (BOIUK) has ‘accelerated growth ambitions’ for Marshall Leasing following its acquisition of the company from Marshall Motor Holdings (MMH) for £42.5 million.

On completion of the deal Marshall Leasing will become part of Northridge Finance, BOIUK’s car and asset finance business. 

Marshall Leasing, which sits at number 26 in the FN50, has a risk fleet of more than 6,000 cars and vans. It provides a range of contract hire fleet services including fleet management, risk management, contract purchase and daily rental, aimed at the small-to-medium enterprise (SME) sector.

However, Peter Cakebread (pictured), Marshall Leasing managing director, told Fleet News: “Bank of Ireland gives us the financial muscle to move forward and I think those growth ambitions will be accelerated. It’s going to open doors for us. This deal is a good platform to allow the business to fulfil its potential.”

Cakebread said it was too early to say what size BOIUK is hoping to grow the business to.

James McGee, Northridge Finance managing director, said: “Marshall Leasing has an excellent reputation in the vehicle hire market, has a strong order book, and is well positioned to achieve further growth.”

The deal is subject to regulatory approval but it is hoped the acquisition will go through before the end of this year and Marshall Leasing will work with MMH through a transitionary period to help support payroll and HR.

Cakebread said: “It’s the same management team and it’s absolutely business as usual. Customers will still be dealing with the same teams they were before. BOIUK has spent considerable money on keeping the teams and experience in place.

“The office will remain in Huntingdon and I’m committed to taking the business forward.”

Marshall Leasing has been a part of MMH since 1979 but the company said the sale allows it to focus on its core dealer group business and help reduce debt.

Daksh Gupta, MMH chief executive, said: “The strategic disposal of our leasing business is an important step for MMH.

“It further strengthens our financial position and allows us to remain focused on driving our core retail operations. In a changing and consolidating retail landscape, we see various exciting opportunities ahead which, with the support of our brand partners, we are now even better positioned to exploit.”

BOIUK will keep the Marshall brand in the medium term as it has paid a one-off £500,000 figure to licence the name for a maximum of five years. Cakebread said a rebrand has not been discussed at this stage.

Northridge provides personal and commercial asset finance serving the dealer, finance broker, and corporate markets.

Cakebread said ownership under Northridge represents a logical opportunity to grow into the personal contract hire (PCH) market to access small business owners and private buyers, but it was still too early to talk about specifics on business plans.

The MMH board said a driving factor behind the sale was the continuing consolidation in the leasing and fleet management market and scale was becoming increasingly important to underpin the ‘capital-intensive’ nature of the business model.

Eight of the top 10 UK motor leasing businesses are owned by banks or vehicle manufacturers. It was the Marshall board’s opinion that Marshall Leasing would be better supported for future growth under different ownership.

Colin Tourick, professor of automotive management at the University of Buckingham Business School, said: “Marshall Group is a diversified trading company. Marshall Leasing was always one of the most capital-intensive parts of the group so I am not surprised about this deal. 

“It is a continuation of a long-term trend. Most independent or dealer-owned leasing businesses of any scale have been acquired.”

Tourick said the deal is good for Marshall Leasing, good for customers and good for MMH. “It’s a tribute to the fact Marshall Leasing has been a long-term player in the market, has a strong management team, good leadership and is well respected by its competitors and clients,” he said.