The balance remains vested with the current shareholders. The agreement between the two companies will see the property division of Aucor and The High St Auction Co merge, with each company holding an equal 50% share of the new entity.
“The merger brings together two complementary businesses, leveraging the strengths of both parties to create the dominant and preeminent player in the property auction market,” comments Darren Winterstein, Managing Director of Aucor. “The decision to combine the different strengths of these two companies was made to ensure the long term commercial sustainability and profit of the business in this sector.”
“Our strategy internally has been focussed on finding and securing leading industry specialists who have an in-depth knowledge and understanding of the sectors in which we work,” explains Winterstein. “This is now extending and will bring companies with specialised industry knowledge into the Aucor fold.”
Since inception in 1968, Aucor, with its broad African footprint, has organically built a diverse and successful auction business disposing of both loose and immovable assets. This has positioned it is as arguably the most well established name in the auction industry. However, following the purchase of a majority stake by a BEE consortium earlier this year, Aucor took the decision to adopt a new merger and acquisition-driven growth strategy, aimed at cementing its market leading position.
The High St Auction Co was identified as a leading industry player, making it an ideal partner to initiate this expansion strategy with. The High St Auction Co was launched in October 2010 and has rapidly become one of the leading marketers and sellers of commercial, industrial, retail, agricultural and residential properties on auction, especially as prevailing market conditions have made auctions a more popular, effective and efficient way to sell properties.
“We saw great synergies between the two companies and liked what The High St Auction Co has been doing in the property auction market,” continues Winterstein. “We were also very keen to secure the considerable human capital and intellectual property contained within The High St Auction Co, as the management team boasts a wealth of knowledge and experience in the industry.”
“We are very excited about the merger, as it is uncommon for such a young, growing company to attract the interest of such a well established industry player,” comments Lance Chalwin-Milton, director at The High St Auction Co “The strong fundamentals that underpin our business and the success we have enjoyed in the market of late has obviously resonated with Aucor, in what is becoming an increasingly competitive marketplace.”
Chalwin-Milton explains that the deal brings distinct benefits to both parties, as it will not only bolster Aucor's business, but it will also give High St. a major boost in the property auction market. “Apart from increasing the value of our company enormously, Aucor’s market position and strength, together with the integration of its property infrastructure into High St., to create a new business model, will deliver greater market share. This will all be underpinned by The High St Auction Co’s experienced and skilled Business Development team.
Aucor's established national and African footprint will also be a major boon for The High St Auction Co, giving the business easy access to new markets. “The acquisition allows us to rapidly expand our business without the operational limitations and restrictions commonly associated with organic growth,” continues Chalwin-Milton.
“It will enable us to leverage off of Aucor's good name, customer base and regional experience. It will also open up new channels to secure stock that we previously didn't have access to, such as distressed properties typically held by banks. This will further stimulate growth by assisting us to drive volume, capture market share and increase revenue.”
“Thanks to the substantial expertise and experience that both parties bring, we envisage this venture bringing a powerhouse to the auction market that will take property auctions to heights never seen before,” concludes Chalwin-Milton.