China Baoxin Auto to buy NCGA dealership group for $305 million
HONG KONG -- China Baoxin Auto Group Ltd. has agreed to buy NCGA Holdings Ltd., a 12-store luxury dealership group in the country operated by U.S.-based McLarty Automotive Partners.
NCGA will remain a minority partner in the combined company. Baoxin said it paid $305 million for its majority stake.
Mark McLarty, the son of U.S. dealer and former White House Chief of Staff Mack McLarty, is chairman of NCGA.
The deal would include the dealerships in NCGA’s Yanjun Auto, a luxury-brand chain in northern China.
Baoxin, a China dealer for BMW autos, said the acquisition of NCGA would add eight BMW/Mini dealerships, two Jaguar and Land Rover dealerships, one Porsche and one Volvo dealership to its operations
McLarty Automotive, which is chaired by Mack McLarty, operates two other international companies besides Yanjun, Caltabiano McLarty in Brazil and GDV Imports Mexico. Former Toyota and Chrysler executive Jim Press is president of McLarty’s international dealership operations.
The NCGA acquisition is expected to expand Baoxin’s geographic footprint in China while generating economies of scale and additional capital to continue the company’s growth.
With IPO markets closed and financing options drying up, China’s capital-intensive car dealerships have become targets for investors, including private equity firms.
U.S. fund Warburg Pincus recently invested $200 million for a minority stake in privately owned China Auto Rental Holdings Inc., China’s largest-ever equity financing deal in the car rental industry.
Reuters contributed to this report