PRESS RELEASE
Cross-Continent Auto Retailers To Acquire Group Of Luxury Car Dealerships In Las Vegas
17 April 1997
Cross-Continent Auto Retailers To Acquire Group Of Luxury Car Dealerships In Las Vegas
AMARILLO, Texas, April 17 -- Cross-Continent Auto Retailers,
Inc. today announced it has reached a definitive agreement to
acquire Chaisson Motor Cars, a multiple-franchise dealership group operating
in Las Vegas, Nev., and Henderson, Nev., for cash, promissory notes and stock
approximating $27.5 million.
The announcement was made by Bill Gilliland, chairman and chief executive
officer of Cross-Continent, and James J. Chaisson Sr., principal officer of
Chaisson Motor Cars.
Chaisson Motor Cars operates a total of three new car facilities in Las
Vegas and Henderson. Chaisson is the exclusive dealership for BMW,
Volkswagen, Audi, Land Rover, Jaguar and other specialty luxury vehicles in
the Las Vegas market. On April 21, 1997, Chaisson BMW will commence
operations in a recently completed state-of-the-art facility located in the
Henderson Auto Mall.
In 1996 the total sales of the Chaisson dealerships approximated
$70 million. The dealerships sold 1,228 new units, 477 used retail units and
360 used wholesale units. Reported revenue and unit sales do not include
Chaisson BMW which commences business on April 21, 1997.
The transaction will be accounted for as an asset purchase, is subject to
customary closing conditions, including appropriate approvals, and is expected
to be completed by the end of the second quarter.
The acquisition presents exciting prospects for Cross-Continent, according
to Gilliland. "Las Vegas is a very attractive car market since it is vastly
under-served," he said. "The Chaisson dealerships fit our acquisition profile
of high-quality, high-revenue dealerships that add shareholder value."
Gilliland noted the acquisition complements Cross-Continent's current
position in the Las Vegas market since Chaisson's facilities are located near
the recently acquired Toyota dealership and are adjacent to the Nissan
dealership which is in the process of being acquired. "The proximity of the
dealerships fits our strategy of consolidating our after-purchase services,
such as the service department and body shop, to deliver quality to our
customers at a very competitive price.
"Chaisson will serve as a consultant to the company following the
completion of the acquisition, while James J. Chaisson Jr. will retain the
general management responsibilities of the dealerships. We expect to retain
all existing dealership management," noted Gilliland.
Cross-Continent anticipates that it will be able to incorporate a number
of efficiencies in its expanding Las Vegas market, including increased used
vehicle sales, used vehicle inventory sourcing advantages and the ability to
leverage certain other operating expenses.
This purchase represents the company's fourth major acquisition following
its initial public offering on September 23, 1996. On October 1, 1996, the
company completed the acquisition of Lynn Hickey Dodge, in Oklahoma City,
which, according to recent industry publications, ranks as one of largest
Dodge dealerships in the nation. On March 3, 1997, the company announced the
pending acquisition of Sahara Nissan, Inc. (Sierra Datsun, Inc.) which
operates a Nissan dealership in Las Vegas under the trade name Jack Biegger
Nissan. On April 10, 1997, the company completed the acquisition of Toyota
dealerships located in Las Vegas and the Denver, Colo. area.
Including the completion of this and other pending acquisitions,
Cross-Continent Auto Retailers, Inc. will own and operate a group of
13 franchised automobile dealerships in Texas, Oklahoma, Nevada and Colorado.
Through these dealerships, the company sells new and used cars and light
trucks, arranges related financing and insurance, sells replacement parts and
provides vehicle maintenance and repair services.
Cross-Continent Auto Retailers, Inc. is listed on the New York Stock
Exchange under the symbol XC.
Cross-Continent Auto Retailers, Inc. believes its shareholders benefit
from the views of management about the future of the company's business.
Included herein are forward-looking statements, including statements with
respect to anticipated revenue growth, acquisitions and profitability. These
statements involve risks and uncertainties that could cause actual results to
differ materially, including without limitation economic conditions, risks
associated with acquisitions and the risk factors set forth from time to time
in the company's filings with the Securities and Exchange Commission.
SOURCE Cross-Continent Auto Retailers
CONTACT: John Gaines of Cross-Continent Auto Retailers, Inc.,
Vice President-Finance, 806-374-8653