Published on 29 Feb 2024 on Zacks via Yahoo Finance

Lithia (LAD) Acquires Carousel Motor to Expand Footprint

Lithia Motors, Inc. LAD announced the acquisition of Carousel Motor Group. Through this acquisition, the auto retailer aims to expand its footprint in Minneapolis-Saint Paul, MN, which is considered one of the largest markets in the North Central Region. Carousel Motor’s acquisition is expected to add around $900 million to LAD’s annualized revenues.Bryan DeBoer, president and CEO of Lithia, said that the expansion in Twin Cities will help the company build its network in the North Central Region to foster long-term relationships with its customers and provide its omnichannel solutions to the market.Nine dealerships, which comprise both premier luxury and domestic brands and are mainly located in the greater Twin Cities area, are part of this acquisition. Among these dealerships, Carousel Hudson Ford is the largest location in Wisconsin and the company’s first Ford dealership in the state. The store adds more brand offerings to LAD's already existing footprint. The company already has three stores in Wisconsin, which are located in Madison and the Milwaukee area.Apart from the Carousel Hudson Ford dealership in Wisconsin, Lithia has acquired eight stores in Minnesota, including Audi St. Paul in Maplewood, Audi Minneapolis in Golden Valley, BMW of Minnetonka and North Branch Chevrolet. Other acquired stores are Coon Rapids Chrysler-Dodge-Jeep-Ram, Porsche St. Paul in Maplewood, Porsche Minneapolis and Twin Cities Performance Ferrari in Golden Valley.Earlier this year, Lithia acquired U.K. car dealership group Pendragon, which is expected to add around $4.5 billion to its annualized revenues. In 2024, the auto retailer has so far added $5.4 billion in expected annualized revenues before the end of its first quarter.Per Tina Miller, CFO of Lithia, the company has divested in Suburban Infiniti of Novi in Michigan so far this year.The acquisition, which is expected to close in the next six to eight weeks, has been financed using LAD’s existing liquidity.

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