The deals, announced since July 19 and each expected to close in the fourth quarter, are the latest planned acquisitions for the small public auto retailer that bought its first half-dozen franchised dealerships in the first quarter for $143.6 million. In May, it bought an 85 percent stake in a Subaru store in Mount Hope, W.Va., for $3.2 million.
LMP said the two Texas dealerships are expected to generate $250 million in annual revenue.
LMP and sellers David Peacock and partner Aldo Paret entered into an asset purchase agreement July 16, according to a regulatory filing, to buy Tom Peacock Cadillac and Tom Peacock Nissan for $120 million. Up to $42 million of that $120 million could be paid in shares of LMP stock, while the rest would be paid in cash and debt financing, LMP said. The deal also looks to include about $21 million for real estate.
At the end of the March, LMP had $8.5 million in cash and $10.9 million in restricted cash per its debt agreement.
This would be LMP’s first entry into the South Central U.S. region and in the popular Texas market.
“We intend to continue expanding aggressively in this region,” LMP COO Richard Aldahan said in a statement. “This acquisition significantly increases LMP’s management team and revenues in this important region along with materially enhancing LMP’s profitability and expanding its reach with a growing reservoir of new- and used-vehicle inventory.”
Tom Peacock Cadillac has been in business for more than four decades. Cadillac wanted the seller to “materially upgrade” the Cadillac facility and “offered material consideration to do so,” but the seller declined, according to the purchase agreement.
Paret declined to comment on the sale.
