Prime completes sale of 2 Toyota stores to Group 1

Prime Automotive Group confirmed Monday it is selling five dealerships in the Northeast, including two Toyota stores that have been sold to Group 1 Automotive Inc.

Prime has been under contract to sell a Subaru, a Chevrolet and three Toyota stores, Automotive News previously reported. The sales process, overseen by Haig Partners, began last summer and is separate from legal action surrounding Prime's parent company, GPB Capital Holdings.

Last month, a federal judge in New York ordered that an independent monitor be appointed to oversee GPB, which has been accused of securities and other fraud by the U.S. and several state governments.

Group 1 CEO Earl Hesterberg said last month the nation's fourth-largest dealership group planned to be more "aggressive in growing externally" this year. The company last bought stores in late 2019, when it purchased two in New Mexico. The company has the financial capability to add $1 billion or more in annual revenue through acquisitions and has deals in the pipeline, executives said.

Pete DeLongchamps, Group 1's senior vice president of manufacturer relations, financial services and public affairs, said the company sees the purchase as likely the beginning of "an acquisitive year for us."

"We, as you know, have a heavy concentration of Toyota dealerships already," DeLongchamps said. "We love the brand. And to add to our scale in the New England area we think is a real benefit for our company."

The two stores — Hyannis Toyota and Orleans Toyota, both in Massachusetts — will keep their names.

Group 1 said in a release that it expects the stores to generate $120 million in annualized revenue. The purchase brings Group 1's total Toyota dealership count to 15 and gives it 10 New England stores spanning the Audi, BMW, Lexus, Subaru and Toyota brands.

The sales of the three other Prime stores are expected to close in the coming weeks, according to a release.

Prime, of Westwood, Mass., ranks No. 11 on Automotive News' list of the top 150 dealership groups based in the U.S., retailing 45,050 new vehicles in 2019.