Australian MSOs AMA, Gemini Merge
Gemini ARC operates 40 shops in Australia and one in New Zealand with a total of roughly 750 employees. With the merger of the AMA Group’s 29 Australian facilities, the group will now have 70 total shops.
The deal could be worth more than $70 million for Gemini, if the company meets required financial performance hurdles outlined in the agreement.
AMA will make an upfront payment between roughly $19 million and $20 million (nearly $25 million less than Gemini’s working capital) to be funded from AMA’s cash resources with an additional $10.66 million to be paid at the end of a three-and-a-half year escrow period, according to the rannouncement. AMA will also award Gemini between $35 million and $36 million in shares at $0.43 per share that will be escrowed for 3.5 years.
“Gemini is an extremely well run business with very competent management and effective systems in place,” AMA’s executive chairman Ray Malone said, according to the report.
“With Gemini and its management team joining the fold, AMA is by far and away the leading operator in Australia’s highly fragmented panel repair market and further strengthens our position to participate in the industry consolidation.”
"I am very pleased and excited to announce that today, Gemini Group has confirmed a merger with AMA. Gemini Group will be the largest shareholder in AMA," said Andy Hopkins of Gemini said in his announcement statement to suppliers, according to the Australiasian Paint & Panel.
"This marks another major step forward in the growth of Gemini and a major leap forward for its business in Australia and New Zealand and further enhancing Gemini’s offering across the country. AMA is an ASX listed entity and is also a leader in our industry, offering clients a complete suite of services in the field of prestige repair and express repairs, as well as specialised automotive aftercare and accessories.”
“I will remain Executive Chairman of the Gemini businesses and sit on the Board as a Director for the new AMA/Gemini Group. I will also head up the whole of the panel division as CEO and work closely with Ray Malone, in the OEM parts of the business.The combination of our two leading businesses has now enhanced our ability to meet our clients’ needs with speed, efficiency flexibility, and service qualities. You can still expect that everything we do from optimising service delivery to expanding capacity in strategic areas will remain exactly the same,” Hopkins added.