Longtime Minneapolis dealer Morrie Wagener is selling his stake in his 11-store group to the family behind construction and engineering giant Bechtel Corp.
Representatives for Morrie’s Automotive Group and Fremont Private Holdings, which is an investment arm of the Bechtel family, confirmed the deal to Automotive News.
The retailer's management structure is expected to stay in place. For example, CEO Karl Schmidt will stay on, and will retain his ownership stake in the dealership group. Financial terms of the deal and the size of the stakes to be owned by Schmidt and Fremont were not disclosed.
Morrie Wagener’s daughter, Cindy Wagener Robin, and his three sons have all worked for the group for much of their careers. Like Morrie, they will move on to new ventures once this deal closes either late this year or early next, said Wagener Robin, the current vice president of operations.
Wagener Robin, 49, plans to stay involved in the charity work she’s done during her 25 years at Morrie’s. Her brothers: Greg Wagener, 55, Chris Wagener, 53 and Charlie Wagener, 51 will, “take a breather and find out what is our true passion,” Wagener Robin said.
The deal remains subject to approval from manufacturers. It will allow Morrie’s, which has annual revenue of around $600 million, to add more dealerships, expand brand offerings, hire more staff and invest in the car-shopping experience, the parties said.
The Morrie’s Automotive Group includes Cadillac, Ford, Lincoln, Nissan, Hyundai, Subaru and Mazda stores.
“The Morrie’s name will continue to be used, and Morrie’s will continue to lead the way in customer experience,” Wagener said in a statement. “I’m excited for my family, excited for the customers and, most of all, excited to watch how Morrie’s Automotive Group evolves the dealership concept.”
Morrie’s is known for its Buy Happy approach, which was introduced in 2009. Major elements of the strategy include one-price selling, no-cost oil changes, free car washes and a free lifetime powertrain warranty with every new vehicle.
The Buy Happy program will continue under the new owners. It was one of the major appeals for Fremont in buying part of Morrie’s, said Scott Earthy, managing partner of Fremont Private Holdings, which is part of San Francisco-based Fremont Group.
“In Morrie’s, we think we found something pretty special,” Earthy said in an interview, praising the elements of Buy Happy. “Would we feel comfortable sending a friend to buy a car at Morrie’s? And the answer is absolutely yes.”
The deal between Wagener and Fremont has been in the works since spring. Wagener started Morrie’s in 1960. Schmidt has overseen operations since 2009.
To an outside investor such as Fremont, the automotive retail market looks promising, Earthy said.
“There’s going to be a need for people to buy and service cars,” he said. “If we do it properly and get our share of the market, we can certainly get attractive returns over time.”
Jamie LaReau contributed to this report.