PRESS RELEASE
Lithia Motors, Inc. Announces the Acquisition of Sun Valley Ford Volkswagen Hyundai in Concord, California
4 April 1997
Lithia Motors, Inc. Announces the Acquisition of Sun Valley Ford Volkswagen Hyundai in Concord, CaliforniaMEDFORD, Ore., April 4 -- Lithia Motors, Inc. announced today that it has signed a definitive agreement to acquire Sun Valley Ford Volkswagen Hyundai in Concord, California. The transaction is valued at approximately $18.9 million depending on inventory levels at closing. The price includes all of the assets of the dealership, certain leasehold improvements, and all of the new and used vehicles. Payment will be in cash and notes. Most of the dealership's facilities will be leased. Closing is expected early in the third quarter of 1997 and is subject to the customary conditions, including approval by the manufacturers. Sun Valley Ford Volkswagen Hyundai had revenues of approximately $70 million in 1996. Sidney B. DeBoer, Chairman and Chief Executive Officer of Lithia, stated, "This is our second acquisition in Concord, California, and our fourth in the East Bay region. We are excited about this acquisition, as it represents further progress towards the realization of our goal of growth through the acquisition of quality dealerships." Mr. DeBoer stated further that significant operational improvements and economies of scale will be gained by clustering valuable franchises within a strong regional economy. Edmund Bartlett, the owner of Sun Valley Ford, will be retiring after having successfully served as the Ford dealer in Concord for many years. Larry Wagner, President, intends to remain as general manager and continue to operate the well-run dealership. The Company also announced the cancellation of the agreement to acquire Linder Honda of Salinas, California. According to Mr. DeBoer, the cancellation would have no material impact on earnings, as it is being replaced by the Sun Valley acquisition, which represents almost three times the sales volume and profit potential of Linder Honda. On April 2, 1997, Lithia also completed the purchase of Magnussen Dodge Isuzu in Concord with Chrysler's approval being granted on schedule and began selling vehicles as Lithia Dodge of Concord. Lithia Motors, Inc. is one of the larger retailers of new and used vehicles in the western United States, offering 16 domestic and imported makes of new automobiles and light trucks at locations throughout Northern California and Oregon. SOURCE Lithia Motors Inc.
CONTACT: Brian R. Neill, Chief Financial Officer of Lithia
Motors, 541-776-6899