National Recovery & Mobility Services Business Plan › Section 13 › Exit Strategy

13.1 Exit Framework

A clearly articulated exit strategy is a core component of the
investor thesis. NRMS is being built with multiple live exit routes,
each addressable independently. The optimal exit channel will depend on
market conditions, the business’s strategic position at Year 5, and
investor preference. All four primary channels described below are
actively anticipated in the business design.

13.2 Exit Channels

Strategic Sale to an Insurance Group

South Africa’s top short-term insurers (Santam, Old Mutual Insure,
Discovery Insure) have demonstrated appetite for vertical integration
into claims supply chains. A national, SLA-compliant, technology-enabled
tow operator is a natural acquisition target — it secures strategic
supply, integrates claim economics, and delivers significant vertical
synergies. Precedent transactions in similar adjacent verticals
(accident management, panel beating, parts distribution) have priced at
8–12x EBITDA for well-positioned assets. This is typically the
highest-value exit route.

Strategic Sale to a Logistics Platform

Large logistics and transport groups (Super Group, Imperial,
Barloworld Transport) maintain vehicle recovery operations that service
their internal fleets but lack the external-customer platform that NRMS
will build. An acquisition by such a group would deliver geographic and
customer-type diversification, and precedent multiples sit at 6–8x
EBITDA. This channel is typically the second-highest-value route.

Private Equity Roll-up

Specialist private equity buyers focused on business services (Ethos,
African Infrastructure Investment Managers, Sanlam Private Equity, Old
Mutual Private Equity) have a documented appetite for fragmented service
industries suitable for roll-up. NRMS as a Year 5 platform with 74
trucks and ZAR 30m of EBITDA is precisely the kind of operator
attractive to a PE roll-up sponsor. Multiples typically in the 5–7x
EBITDA range, with opportunity for management reinvestment.

AltX / Main Board Listing

A listing on the JSE AltX or (at greater scale) Main Board is viable
once the business achieves approximately ZAR 200 million in revenue and
ZAR 50 million in EBITDA. This is a Year 6–7 option rather than a Year 5
option. The listing would deliver liquidity for early investors while
retaining the business’s independence. Public-market comparables for
asset-backed services trade at 8–11x EBITDA in normal conditions.

13.3 Valuation Drivers

Regardless of exit channel, three factors drive terminal
valuation:

• Contracted revenue ratio — Buyers pay a premium
  for predictable, contracted revenue. A Year 5 contracted revenue ratio
  above 75% supports a valuation multiple 1.5–2.0 turns higher than a
  predominantly retail comparator.
• Fleet quality & age profile — A
  well-maintained, disciplined-age fleet avoids a large post-acquisition
  capex requirement and is a significant positive valuation
  driver.
• National footprint — National coverage is
  exceptionally rare in SA towing. A buyer acquiring NRMS acquires
  national scale that would otherwise require 3–5 years of organic
  build-out.

13.4 Exit Preparation

Exit preparation begins formally at Month 28 (approximately 8 months
before anticipated transaction launch). Key preparation workstreams
include: (i) financial audit upgrade to listed-company-standard
disclosure; (ii) commercial due diligence vendor documentation pack;
(iii) contract review and extension of all material SLAs beyond any
transaction close; (iv) management succession review and bench-strength
demonstration; (v) appointment of corporate finance advisor with track
record in the automotive-services or business-services sector.

Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of National Recovery & Mobility Services (NRMS).