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AC rescued: Britain's oldest car maker set for bright future

Press release
6 December 1996

One of the world's best known classic sports cars - the AC Cobra - has been saved. A new company - AC Car Group Ltd - has acquired the assets and business of the former AC Cars company, Britain's car maker with the longest record of continuous production.

AC Car Group Ltd, a subsidiary of US NASDAQ listed Pride Automotive Group, Inc., has acquired the AC business from the administrative receivers of AC Cars Ltd, Price Waterhouse, which has been running the company since it collapsed in March this year.

In a multi million pound deal, AC Car Group has become the sole producer of the genuine AC Cobra, one of the most exciting sports cars ever produced, together with a brand new luxury model - the AC Ace - of which only a handful have been built so far.

According to plans announced today, the new company will maintain production of the Cobra and, after further technical enhancements, launch the Ace to world markets during 1997.

"AC is one of the best known marques in world sports cars. We are in full production of the Cobra right now and will be maintaining and growing the AC presence in the buoyant market for distinctive, high performance cars", said Alan Lubinsky, President and Chief Executive of Pride Automotive.

"Such is our faith in the AC models that during the receivership we have been funding continued production of the Cobra and ensuring continuity of employment for the 35 skilled craftsmen at the Weybridge site. Now we can begin investing in the future and build on the enormous reputation AC has around the world", he went on.

South African-born Mr Lubinsky will be devoting much of his energies to running AC in the future. He will be joined in the task by David Beck, formerly Managing Director of Lex Retail Group. Mr Beck, in a consultancy role, will be planning an international marketing strategy for AC and appointing selected dealers in world markets.

"We will be concentrating our efforts in markets where the merits of hand built, high quality English sports cars are well understood", said Mr Beck. "Aside from the UK, Germany and certain other European countries, we will of course be looking to re-enter the North American and Australasian markets as a matter of urgency. We are now considering candidates to sell AC cars in all of these territories".

xxx from Price Waterhouse said: "I am delighted that the future of AC has now been secured. Significant interest in the business was shown by a number of potential new owners but I am confident that Pride Automotive's established motor industry focus will give the business the best chance of developing in the future".


NOTES TO EDITORS:

AC Car Group is based in Weybridge, Surrey close to the historic Brooklands race track. The company's history can be traced to a South London workshop which began car production in 1901.

The brutally fast Ford V8-engined AC Cobra (in pre-speed limit days it reached 196mph on the M1!) was devised by AC in conjunction with Texan racing driver Carroll Shelby. Now throughly updated, its unique blend of performance and style has made the AC Cobra a true classic car.

The new AC Ace model received rave reviews from the motoring press in 1995 but never entered full production. Its design is now being revised to meet safety and environmental regulations and offer even greater driving enjoyment.

Both the Cobra and Ace feature sturdy stainless steel chassis and hand-crafted aluminium bodywork.

Pride Automotive's principal business is vehicle leasing. Although a US-registered company, its headquarters are in Watford, UK. In the year to November 1995 the company had a turnover of $9.7 million (L6.5m).


AC: a proud history of craftsmanship

Thirty five years of association with one of the best known models in the lexicon of classic sports cars - the Cobra - has given the AC name a cachet many of its more modern competitors can only dream of.

The Cobra is a byword for fast, muscular motoring and for many years in its original guise was listed by the Guinness Book of Records as the world's fastest production car. Now, with a 5 litre American Ford V8 engine meeting the latest environmental regulations around the world, the L73,000 Cobra still combines mighty power with unique and distinctive body styling.

Conceived more than 35 years ago, the all metal Cobra body (unlike some competitors, there is no glass fibre here!) has the enduring good looks which have found it favour with a loyal circle of keen driving enthusiasts around the world.

The Cobra's interior is trimmed with English leather and deep pile wool carpeting. Both a convertible top and tonneau cover are supplied. But Cobra motoring has more to do with muscle-power than creature comforts. Since the car's conception by AC and Texan racing driver Carroll Shelby in the early Sixties, the Cobra has developed a well-earned reputation for delivering the ultimate in performance.

The car gained notoriety in 1963 when questions were asked in the House of Commons following a 196mph run by a Cobra along the then unrestricted M1 motorway in the UK.

In the mid Eighties - when AC was temporarily controlled by Ford Motor company - a new car was conceived to be built alongside the Cobra - the Ace. Again a striking, all metal hand-built design was developed and, again, an American Ford V8 was installed.

The Ace has earned lavish praise from motoring journalists whenever it has been displayed or driven ("one of the nicest drives of recent memory" - Autocar & Motor; "an experience like no other car" - AutoExpress; "its steering, ride and handling, build materials and equipment are all first rate" - Performance Car; "outstanding chassis is its winning card" - LJK Setright in Car).

However, the former AC business was never able to bring the Ace to full production, with the result that early sales opportunities could not be properly realised before the company itself ran into financial difficulties early in 1996.

Now AC Car Group, the new company which has today taken control of AC, is committed to re-introduce the Ace once it is fully satisfied that high quality production can be sustained. It is also working on a number of technical enhancements to the specification to bring the car fully in line with latest legislative and performance standards.

"The Cobra is in production and available from today", says Alan Lubinsky, President of Pride Automotive Group, AC Car Group's parent company. "With the Ace we shall take our time to get every detail of the specification and build process right before we relaunch such a desirable product. I envisage we will be able to do that in mid-1997. At the same time we will be reviewing opportunities to further develop the AC range within the high performance sports car sector".


Pride Automotive Group - the power behind AC

Pride Automotive Group, Inc. is a Delaware, USA, incorporated company which controls six wholly-owned UK subsidiaries: Pride Vehicle Contracts Ltd, Baker Vehicle Contracts Ltd, Pride Vehicle Contracts (UK) Ltd, Pride Leasing Ltd, Pride Vehicle Management Ltd and Pride Vehicle Deliveries Ltd.

The companies are jointly engaged in the business of leasing new cars and commercial vehicles to business customers, servicing those vehicles during the lease period and reselling them at the end of the lease. In some cases Pride Automotive also provides fleet management services for customers.

The shares of Pride Automotive Group, Inc. were listed on the NASDAQ SmallCap Stock Market in America during April 1996. The company had a market capitalization of $12.5 million and had total assets of more than $26 million at the end of August 1996.

Pride Automotive Group operates from offices in Watford, Hertfordshire where 17 staff are employed. In addition to Alan Lubinsky, who is president, chairman and secretary, the other directors are Peter Dixon, 51, vice president and treasurer (Mr Dixon is also a director of Kingsland Developments Ltd, a property company) and Ivan Averbuch, 40, chief financial officer (Mr Averbuch was formerly a partner in a South African associate of Grant Thornton, the UK accounting firm). All three directors are resident in the UK.

"Pride Automotive's exclusive focus on the automotive business, together with our excellent financial support from shareholders and bankers, underwrites the serious commitment we are making in acquiring AC", says Alan Lubinsky, chairman of Pride Automotive.

"Although I am a sports car enthusiast and have owned many 'classics' of the genre over the years, I and my colleagues see AC as a real business opportunity. We are prepared to invest in its future because we can see significant growth prospects ahead, based on the excellence of the Cobra and Ace", he said.


The men behind AC Car Group

Alan Lubinsky, 38, who is behind the acquisition of the AC business, has been involved with the motor industry for almost all of his working life.

After early training as an accountant in his native South Africa, he began trading in used cars and eventually developed the business into an Austin Rover and Jaguar dealership with car hire interests.

After the then British Leyland organisation effectively withdrew from the South African market Mr Lubinsky moved to the UK and, in 1987, set up Pride Vehicle Contracts Ltd. The business has grown by acquisition into a profitable and sizeable operator in the UK contract hire market, providing vehicle leasing and fleet management services to a variety of corporate clients. It has relationships with more than 1,400 franchised outlets in respect of the servicing of the vehicles it leases.

Mr Lubinsky describes himself as having a lifelong "liking for cars on a commercial basis". He has owned a variety of sports cars, ranging upwards from an early MGA in South Africa via MGB, Triumph TR3, TR6 and TR7, Mercedes 190SL and Porsche 911 through to a Mercedes 320SL. Recently, he has acquired one of the few AC Aces built so far and cannot wait for the day when a fully productionised, re-engineered Ace is sitting in his driveway!

Playing a critical role in the rebuilding of the AC marque alongside Mr Lubinsky is David Beck, 51, who - in a non-executive, consultancy role - will be responsible for setting up a global distribution network for AC and for determining sales and marketing strategy.

A qualified accountant, Mr Beck has 27 years operational experience in the international automotive industry having held managing director positions both in vehicle manufacturing organisations and more recently in distribution. For six years he was Managing Director of Lex Retail Group, the largest vehicle retail organisation in the world with annual sales of 100,000 new and used cars with a value of over L1 billion.

Since 1995 David Beck has been developing his own consultancy business specialising in automotive distribution with manufacturer and distributor clients in the UK, Germany, Spain, France and Portugal.

Mr Beck was for five years Managing Director of Leyland South Africa and it was during that time that he met and worked with Alan Lubinsky.

David Beck's automotive expertise makes him ideally placed to advise AC on its development and to establish an international distributor organisation to put AC back on the world map. He has already embarked on the task of selecting dealers who can help sell one of the all time great sports car marques.

For further information please contact:

Martin Hayes, Communications Advisor
(phone) 44 171 437 7955 and (fax) 44 171 437 7966 (UK).
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luukb@xs4all.nl (Last updated December 1996)