Automotive retailer Group 1 Automotive Inc. (GPI) has completed the acquisition of a Honda Motor Co., Ltd. (HMC) dealership – Joe Marina Honda – in Tulsa, OK. Consequently, the dealership will be renamed as South Pointe Honda.
The deal is expected to boost annual revenues of Group 1 by $60 million. The company’s revenues went up 23.0% to $7.5 billion in 2012. In the second quarter of 2013, Group 1 reported a revenue increase of 23.2% year on year to $2.3 billion, beating the Zacks Consensus Estimate of $2.1 billion. The year-over-year improvement was driven by strong business performance, higher retail new vehicle sales and improved revenues from the Finance and Insurance business.
The new dealership will strengthen Group 1’s association with Honda, which is one of its largest selling brands. Honda and its luxury vehicle division, Acura, cumulatively generated 13% of the sales of Group 1 in the second quarter of 2013. Toyota Motor Corporation’s (TM) Toyota, Lexus and Scion brands generated combined sales of 27%, surpassing Group 1.
Group 1 is an international automotive retailer that sells 33 brands through 140 automotive dealerships, 179 franchises, and 35 collision centers in the United States, the United Kingdom and Brazil. The company regularly acquires new dealerships to expand its business.
In Jun 2013, Group 1 acquired a Ford Motor Co. (F) dealership – Rountree Ford Lincoln in Shreveport, Louisiana, which is expected to boost revenues by $80 million per annum. Even in Feb 2013, the company acquired 4 Ford dealerships in southwest London. The acquisition is expected to generate about $177 million in annual revenues.
Further, in Mar 2013, Group 1 closed the acquisition of Brazil’s largest automotive retailer, UAB Motors Participacoes S.A. The company has purchased 100% of the outstanding shares and interest in 18 dealerships of UAB for about $47.4 million cash and 1.45 million shares of its common stock along with the assumption of roughly $62 million of net non-floor plan debt.
Group 1 currently carries a Zacks Rank #2 (Buy).
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment