Sonic Automotive, Inc. Announces Two Acquisitions
19 November 1998
Sonic Automotive, Inc. Announces Acquisitions of Tom Williams Dealership Group and Rally MitsubishiCHARLOTTE, N.C., Nov. 18 -- Sonic Automotive, Inc. announced today that it has entered into definitive agreements to acquire the Tom Williams Dealership Group in Birmingham, Alabama and Rally Mitsubishi in Nashville, Tennessee. The Tom Williams Dealership Group includes Tom Williams Buick, Tom Williams Cadillac, Tom Williams Lexus and Tom Williams Imports (BMW, Audi, Range Rover and Porsche). The dealerships being acquired have estimated 1998 revenues of approximately $230 million. Combined, these transactions are valued at approximately $37.5 million. A combination of Class A Common Stock and Convertible Preferred Stock will be issued for approximately $14 million of the purchase price, and the remainder will be payable in cash. Both acquisitions are expected to close in the first quarter of 1999. Williams Dealership Group 0. Bruton Smith, the Company's Chairman and Chief Executive Officer, stated "Birmingham is an example of the growing Sunbelt markets Sonic is entering. We see continued opportunities to enter new markets and execute our 'hub and spoke' acquisition strategy." The Tom Williams Dealership Group acquisition gives Sonic Automotive its first dealerships in the Birmingham, Alabama market. Included in the Williams Group are the Company's first Lexus, Porsche and Range Rover franchises. Tom Williams, Sr., the former owner will join Sonic as a Regional Vice President. Mr. Williams began his automotive career as district manager of the regional office of General Motors in Atlanta, Georgia in 1961. In 1973 after several years in auto retailing as a general manager, Mr. Williams acquired Drennen Motor Co. in Birmingham. He has over 30 years of automotive retailing experience and his dealerships are noted for their high level of customer service and satisfaction. Recently, he has won the highest possible customer satisfaction awards for several of his franchises including the Elite Lexus Dealer Award, the Master Dealer for Cadillac Award and The Best in Class Buick Dealer Award. "I'm pleased to join Bruton Smith and others at Sonic Automotive. Together we see continued growth and opportunities in the state of Alabama and city of Birmingham," stated Tom Williams. "Tom Williams is an example of the best in automotive retailing. Tom's reputation in the industry and in Birmingham is a credit to Sonic Automotive. We're excited to have Tom join our management team," stated Mr. Bruton Smith. Rally Mitsubishi Sonic Automotive, Inc. is also acquiring Rally Mitsubishi in Nashville, Tennessee. With the completion of this acquisition, Sonic will own three dealerships in this major Tennessee market. "Sonic continues to execute its acquisition strategy of building market share in existing markets. Combining the Mitsubishi franchise with existing Sonic operations in Nashville will leverage economies of scale in management, advertising and inventory management," stated B. Scott Smith, the Company's President and Chief Operating Officer. Sonic Automotive, Inc. is one of the leading automotive retailers in the United States, with operations in Alabama, Florida, Georgia, North Carolina, Ohio, South Carolina, Tennessee and Texas. Upon completion of these acquisitions, Sonic will operate 73 franchises and 15 collision repair centers. Included herein are forward-looking statements, including statements with respect to anticipated revenue growth. There are many factors which affect management's views about future events and trends of the Company's business. These factors involve risk and uncertainties that could cause actual results or trends to differ materially from management's view, 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.