LMP to buy dealerships in Florida and Texas

LMP Automotive Holdings Inc. said Monday that it plans to buy an 85 percent stake in 10 new-vehicle franchised stores in Florida and separately buy five import dealerships in Texas.

The two deals, if completed, would add a combined $937 million in annual revenue to the growing publicly traded group that has just more than a half-dozen franchised dealerships currently, with several deals under contract. The company said it would spend $211.6 million on the two acquisitions, including real estate.

LMP said it would buy an 85 percent stake in the Alan Jay Automotive Network of Sebring, Fla., paying $50 million for the dealerships' goodwill and about $44.1 million for real estate. LMP said in addition to cash and debt it could finance the deal with as much as $25 million of common stock.

The retailer said the deal includes 21 franchises including mainly domestic brands, plus Kia, Nissan, Toyota, Maserati and Alfa Romeo.

The transaction includes 10 new-vehicle franchised dealerships, a used-vehicle store and a commercial fleet operations center, said Alan Jay Wildstein, CEO of the Alan Jay Automotive Network.

“It’s just the right timing and they’re the right partner,” Wildstein told Automotive News about his decision to sell a majority stake in his business. He noted he’s looking forward to working with the LMP executive team.

The transaction, expected to close in the fourth quarter, would generate about $345 million in annual revenue, LMP said.

Wildstein said the deal does not include the group's half-dozen stores in Michigan and Miami.

Once the deal closes, Wildstein will join LMP as a partner and regional vice president in the Southeast and will remain as dealer principal for his group of stores. Alan Jay's Michael Witham will continue to be COO of the Alan Jay stores and James Lizotte will be vice president of operations of the Alan Jay group.

Kerrigan Advisors, a sell-side firm in Irvine, Calif., is representing the seller in the transaction, according to a Tuesday regulatory filing.

For the Texas transaction, LMP said five import stores are expected to generate about $592 million in annual revenue.

Steve McGavock, principal of the McGavock Auto Group, entered into an agreement with LMP on Friday to sell four Nissan stores in Abilene, Amarillo, San Marcos and Lubbock, and an Infiniti store in Lubbock. National Business Brokers, a buy-sell firm in Irvine, Calif., is handling that transaction for the buyer and seller.

LMP said the McGavock acquisition also is expected to close in the fourth quarter. The group said on Monday in a news release that it would pay about $62.5 million in goodwill for the dealerships and $55 million for real estate. The retailer said it would pay for that transaction through cash and debt, with up to $6.25 million paid for in common stock. But a Tuesday regulatory filing, which included a copy of the agreement, says the purchase price is $61.5 million, of which up to $10 million could be paid for with common stock.

McGavock also has a Nissan store in Rockwall, Texas, that is not part of this deal.