2CC - 2 Cheap Cars Group

[Otago K]

Takeover Notice under Rule 41 of the Takeovers Code - 2CC
13/07/2026, 08:31 NZST, TRANSACT
Sena & Co Limited (Sena & Co) gives notice pursuant to rule 41 of the Takeovers Code that it intends to make a full offer under the Takeovers Code to purchase all of the ordinary shares in 2 Cheap Cars Group Limited (2CC) not already held by Sena & Co.

Offer price is 80 cents per share.

lorraina

Could I please ask your view on the adequacy of the 80c, envisage you might not be a greatly enthusiastic seller, but mindful that you are a long term advocate of the cashflow merits in 2CC so I would genuinely appreciate your perspective?

Discl : smaller % holder in entity from trading levels a year back so personally couldn't complain about 80c

[lorraina]

80 cents does appear to be on the lite side.
Like you however I could not complain about it.
I have been told to leave accepting any offer to the last minute,which I will do.
Not rational,however the funds [non taxable profit] would pay off the granddaughter's mortgage and leave us with a substantial amount to reinvest..

Disc wife and I combined hold 2.8% of the company.

[Basil]

Congrats. Tina said she's happy to give you a bigger hug.

[SCOTTY]

Well done Lorraina 👍. I'll probably wait for the compulsory purchase once 90% is reached - usually the top price 🤔

[lorraina]

Yes early days.
In guess we will see an independent report,etc.

My "fair value" price is $1.20....

[Otago K]

Yes early days.
In guess we will see an independent report,etc.

My "fair value" price is $1.20....

Thanks lorraina
I'd logged back in to say after taking a walk my gut was saying something closer to your mark would be what
I would walk away feeling satisfied in the here and now. Appreciate not yet time to decide but agree likely best option is to wait.

[Stockgathering]

Yes early days.
In guess we will see an independent report,etc.

My "fair value" price is $1.20....

I agree, average free cashflow according to Invest Direct for the last 5 years was just over $5m a year.
We should not let this go to cheaply.

[lorraina]

Receipt of Takeover Notice

2 Cheap Cars Group Limited (NZX:2CC) (2CC) advises that it has received a Takeover Notice (Notice) under the Takeovers Code from Sena & Co Limited (Sena & Co), indicating its intention to make a full takeover offer (Offer) for 100% of the fully paid ordinary shares in 2CC not already owned by it.

A copy of the Notice is attached. This does not constitute a formal takeover offer. If Sena & Co proceeds to make a takeover offer, it must do so within the period that begins 10 working days and ends 20 working days after today. Shareholders should be aware that Sena & Co is not legally obliged to make an offer during this period and, if it does not do so, the Notice will lapse.

Based on the Notice materials provided by Sena & Co, the proposed consideration would be for $0.80 in cash per share.

Sena & Co is the majority shareholder of 2CC, holding approximately 76% of the Shares in 2CC. It is wholly owned by the trustees of the Sena Family Trust, of which Yusuke David Sena, 2CC's CEO and director, is a trustee and beneficiary.

A Takeover Committee (Committee) of the 2CC Board comprising the independent directors, Michael Stiassny (chair of Committee) and Gordon Shaw, has been established. The Committee will manage engagement with Sena & Co, and consider and respond to the Notice and any ensuing takeover offer.

2CC has appointed Simmons Corporate Finance Limited as the independent adviser to provide a report on the merits of the Offer. 2CC has also appointed MinterEllisonRuddWatts as legal adviser and Craigs Investment Partners as financial adviser.

2CC and Sena & Co have entered into a costs reimbursement agreement, under which Sena & Co agrees to reimburse certain costs incurred by 2CC and its directors in connection with the Offer, including for the period prior to receipt of the Notice.

Should Sena & Co proceed to make a formal takeover offer, it is currently proposed that 2CC will issue a Target Company Statement at the same time as the formal takeover offer is made. This will include an Independent Adviser's Report and comments from the Committee on the actions shareholders should take.

2CC recommends that shareholders do not take any action until they have received and considered:
•the formal offer documentation from Sena & Co; and
•2CC's Target Company Statement, including the Independent Adviser's Report.

2CC will continue to keep shareholders informed.

For enquiries, please contact Angus Guerin, CFO: angus.guerin@2ccgroup.co.nz

Announcement authorised by:

Michael Stiassny - Independent Director, Chair
Gordon Shaw - Independent Director

[Basil]

What do you really think Lorriana, is 80 cents fair and reasonable ?

[lorraina]

This is a note I sent to David Sena.;

Hi David,
I like the sector ,the company's strong balance sheet and low debt and positive cash flow from operations.
I like the way you run the business and have enjoyed seeing you do what you say you will do.
I think it makes sense that you own the business 100%,although I will be sad to sell our shares.
However I think because the present outlook is so strong the shares are worth between $1.05 and $1.35..
Austen


PS.As you know with illiquid shares you have to buy/sell when there is liquidity .
This means we will most probably sell into the take over.
The independent report should make for interesting reading.
As I have previously posted selling would mean we can pay off the granddaughters mortgage with our profit ,and still have a substantial amount to reinvest..
A lot has been made of the risks of importing cars from Japan.However for the past 50 years it has meant NZ vehicle fleet has stayed reasonably modern.

[winner (n)]

Time to get that new Merc or Jag lorriana ...or a Alfa Romeo

[Basil]

It feels good to help your kids and grandkids, no question about that !

One thing that intrigued me that I wonder if you could provide further clarification on, is they said in the FY26 annual report that FY26 was impacted to the tune of $1.7m by extra carbon costs relative to FY25, (however the profit stayed very similar year on year), but that the regime had changed by the fourth quarter providing relief.  They didn't seem to quantify that relief ?

Doesn't that carbon credit change imply quite a meaningfully more helpful trading environment going forward and what would the estimated reduction in carbon credit costs be in FY27 relative to last year ?  Any insights on that you can share ?

Time to get that new Merc or Jag lorriana ...or a Alfa Romeo

You're quite right there Winner, you cannot take your money with you when you go and your, mine and Lorriana's kids and grandkids as well as many other posters on here with their kids will probably inherit far more than they really deserve. 

[lorraina]

Annual report to 31st March 2025.
Revenue was boosted by $1.7 million related to carbon credits
generated and retained in the prior fiscal year, but not previously
recognised due to regulatory uncertainty regarding their
realisation. This revenue was then partly offset by $1.1 million of
carbon credit costs associated with net credits attached to vehicles
sold in FY25.

Half year interim result 13th November 2025.
Gross margin decreased by two percentage points to 19%, primarily due to the impact of carbon tax costs under the Clean Car Standard. The $0.7 million decrease in NPAT primarily reflected the $0.7 million after-tax impact of the Clean Car Standard, as other favourable and unfavourable movements largely offset each other.

Therefore Govt Clean Car regs affected 2CC 2025 results.
On 1st January  2026 The Govt altered The Clean Car regs which resulted in 2CC taking off.

From latest annual report.
Hybrid and electric vehicles continued to make up a significant and growing proportion of the
Group's sales mix in FY26.
For the full year, EV/HEV vehicles averaged approximately 60% of total vehicle sales, up from
approximately 50% in FY25. While the mix eased slightly in the final quarter, demand remained
strong across the year, reflecting both a clear customer preference for more fuel-efficient vehicles
and the Group's ability to adjust sourcing through its direct procurement capability in Japan.
This shift highlights the importance of maintaining a flexible sourcing model and a product mix
that reflects customer affordability, fuel-efficiency preferences and the ongoing impact of Clean
2026 2025 Change % Car Standard settings.
 
Trading Update 19th June 2026.
As outlined in the Company's FY26 results announcement (29 May 2026), trading momentum improved materially through the second half of FY26. This was driven by stronger vehicle margins, improved procurement conditions, disciplined cost control and robust finance and insurance penetration rates.

This momentum has continued into the early part of FY27.

The Company recorded net profit after tax (NPAT) of approximately $0.6 million in March 2026, the final month of FY26. Unaudited management accounts for April and May 2026 also each show NPAT of approximately $0.6 million. Trading through the first half of June has remained positive

[lorraina]

Time to get that new Merc or Jag lorriana ...or a Alfa Romeo

Hmmmmmmmmm.?The 2004 Nissan Slyphy.
I was going to buy a new car when I turned 70.
Then I put it off until I turned 75.
Then I put it off until I turn 80.Bit over two and a half years away.
A few months ago the Nissan started stalling a the lights.Thoughts turned to a new car.
However a magic mechanic said it was the throttle bodies carboning up.$40 later she is running like a Swiss watch.
Manager at Flag tyres said last time I sailed through a WOF."This is a nice car".Wise man...lol

[Basil]

Hi David,
I like the sector ,the company's strong balance sheet and low debt and positive cash flow from operations.
I like the way you run the business and have enjoyed seeing you do what you say you will do.
I think it makes sense that you own the business 100%,although I will be sad to sell our shares.
However I think because the present outlook is so strong the shares are worth between $1.05 and $1.35..
Austen

I think your assessment of fair value is sound.  Will he be forced to increase the takeover price is the $64,000 question ?