Lithia Motors Inc. is now the owner of southeast Michigan's Suburban Collection and 34 of its dealerships in a deal expected to add $2.4 billion in annual revenue.
The sale, first reported in January and which closed Monday, is one of the largest-ever acquisitions for Lithia as well as one of the largest auto-retail transactions of the past decade.
Specific terms of the acquisition were not disclosed.
But Lithia CEO Bryan DeBoer, in an interview, said the price Lithia has paid for recent acquisitions has been equal to 15 to 25 percent of a dealership group's annual revenue, and that the Suburban deal fell in the middle of that range. That would make the value of the deal about $500 million. He said the company's net investment includes retail operations, goodwill, some inventory and real estate.
The deal also included eight used-only stores and three collision centers.
Lithia paid for the deal using most of the remaining capital raised in concurrent equity and debt offerings last October, the statement also said. Shares in the company fell 3.7 percent to close Tuesday at $387.92.
Lithia, the nation's third-largest new-vehicle retailer in 2020, has now acquired dealerships with annualized revenue of about $6.5 billion since its July announcement of plans to generate $50 billion in revenue and earnings per share of $50 annually by 2025.