After sale, dealer longed to return to private world
Bill Wallace: “We drank the Kool-Aid.”
In 2000, when Florida dealer Bill Wallace negotiated his way out of a noncompete agreement with AutoNation, the public retailer that had bought his group of dealerships three years earlier, he didn't waste a minute.
"I was so anxious to get back to running a business," said Wallace, who had felt restricted in his role as a regional operator for AutoNation.
When he sold his five-store group for $55 million in stock plus assumption of debt in 1997, Wallace, then 48, knew he wasn't ready for the golf course. Securing an operating role at the public retailer was a necessary part of the package.
Wallace felt he would be missing a big opportunity if he didn't join the surge of public consolidators. He worried that dealers who didn't join the public concept wouldn't make it.
"We drank the Kool-Aid," said Wallace, whose grandfather started as a dealer in the 1920s. "I really thought this was it. It was the next new thing, and I just felt it would be impossible to compete with them."
Wallace, who had envisioned a lot of autonomy in the operating role with AutoNation, didn't find it. Handcuffed by a restrictive noncompete agreement, he stayed for three years before being able to finalize a way out. AutoNation let him buy back one of his original stores, a Lincoln-Mercury dealership in Stuart, Fla. He soon was able to start buying stores again, albeit in a more distant location 40 miles from his original base in West Palm Beach.
Since AutoNation had adopted the Maroone name for its South Florida stores, Wallace even was able to put his name on his dealerships. Wallace Automotive Group continues to grow today. It now has nine dealerships after Wallace bought a Chevrolet store last fall.
Wallace, now 64, says he wouldn't have sold his original stores if he had the decision to make again. His original stores are in more robust, higher-profit markets than where he is now. But he's not complaining or looking back. He has security for his family, and he sold the stores with his eyes wide open.
"They were very fair," Wallace said of AutoNation. "I don't feel like they owe me anything."
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