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Kwik-Fit Won't Fetch $1B
Ford, which is trying to sell Kwik-Fit, a British tire and muffler service
chain it bought in 1999, is finding the market difficult. According to
estimates, the business it paid $1.5 billion for is currently valued at just $225
million. Reports in the British press say it has emerged that the firm's
accounts understated its liabilities by $5.1 million. This has put off potential
buyers and their bankers, and according to the London Sunday Times, Ford may
have to help out with financing to persuade a buyer to take Kwik-Fit off its
hands. Ford bought Kwik-Fit in the days when Jacques Nasser was keen on
turning the auto giant into a firm that would look after its products from the
cradle to the grave. However, it never worked out that way and Ford's stewardship
of the business, set up by Scottish entrepreneur Sir Tom Farmer in 1971, was
unsuccessful. Farmer, who had stayed on as Chairman and Chief Executive, had
been interested in buying the company when Ford put it up for sale but the
company was not willing to return it to him. It had been hoped to recoup $1.2
billion for the firm, but the current business mood makes that look
impossible.
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