US automotive retail and service company Asbury Automotive has agreed to buy some assets of luxury dealer group Park Place Dealership.
The deal is valued at $685m of goodwill and approximately $50m for parts, fixed assets and leaseholds. It does not include vehicle inventory.
The proposed acquisition includes a total of 12 new vehicle franchises located in the Dallas / Fort Worth market. They are three Mercedes-Benz, three Sprinter, two Lexus, one Jaguar and one Land Rover, one Porsche, and one Volvo.
It also includes the Park Place auto auction and two collision centres.
The acquisition could take Asbury’s overall portfolio from 36% to around 49% of revenue resulting from luxury brands.
Asbury president and chief executive officer David Hult said: “We are pleased our business model and performance allowed us to navigate the current environment and re-engage on a highly strategic acquisition that will make us an even stronger company.
“We have seen our new and used volume sequentially improve each week in May and June with higher profit per vehicle.
“We have also seen our Parts and Service business improve in June as the economy gradually opens-up.
“Strong May and June performance, along with cost restructuring efforts, have driven higher profitability and cash flow, giving us conviction to move forward with a revised Park Place acquisition.”
The deal is dependent on the satisfaction of customary closing conditions, expected for conclusion in the third quarter of this year.