Lastminute deal steers car hire chief to £20m

A self-made businessman who left school at 15 and worked as a labourer, supermarket shelf stacker and life assurance salesman was £20m richer yesterday after selling his car hire company to lastminute.com.

A self-made businessman who left school at 15 and worked as a labourer, supermarket shelf stacker and life assurance salesman was £20m richer yesterday after selling his car hire company to lastminute.com.

Clive Jacobs, the chairman of Holiday Autos, is taking a mixture of cash and shares in return for his 48 per cent stake in the company. After the deal, which values Holiday Autos at £39.7m, Mr Jacobs will emerge with a 4 per cent stake in lastminute, making him a bigger shareholder in the business than Martha Lane Fox, one of its two original founders.

Lastminute has pulled off a string of acquisitions in the past two years using its own stock. This latest deal will be financed through the issue of 27 million new shares to the owners of Holiday Autos, a placing of 14.8 million shares in the market to raise £12m and £4m of its own cash.

Ms Lane Fox described the purchase of Holiday Autos as "a transforming acquisition" which would increase its total sales this year to £650m, keeping it on course to become a £1bn-a-year business generating £100m in profits before interest, tax, depreciation and amortisation.

Mr Jacobs founded Holiday Autos in 1987 with less than £5,000 of capital and has since grown it into the world's biggest car rental broker with £154m of sales and 7 million daily rentals and operations in 40 countries. Last year it made an Ebitda profit of £2.5m.

Lastminute will pay a further £1.7m depending on Holiday Autos' performance in the next six months and Mr Jacobs stands to get an extra £1.6m under a lock-in agreement lasting until March 2004.

He will become vice-chairman and executive director of Lastminute and will own 11.3 million shares, making him its second biggest individual shareholder after Brent Hoberman, the other co-founder, who will have a 5 per cent stake. Ms Lane Fox will own 10.2 million shares, equivalent to 3.6 per cent.

She rejected fears that there might be a clash of personalities and cultures on the board, describing herself, Mr Hoberman and Mr Jacobs as "the Three Musketeers". Speaking of Mr Jacobs, she said: "Not only do we love his business, we love him. We wouldn't be doing this deal if we didn't have enormous respect for Clive."