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, California
MEDFORD, 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