Acquisition Update
The manager of our multi-sector private equity investment has acquired a 90% economic interest in 32 franchises of Prime Motor Group (“Prime”), as well as a 100% of the underlying real estate (collectively with Prime, the “Portfolio Company”). Prime was established by David Rosenberg upon the purchase of two New England dealerships in 2007. Since that time, Prime has grown to encompass over 30 franchises across Massachusetts, New Hampshire, Vermont, and Maine. Prime boasts 2016 results of approximately $1.4 billion in top line revenues and approximately 35,000 vehicles sold, and has established itself as one of America’s Top 30 private auto groups based on total revenues according to Automotive News’ 2016 Top 150 Dealership Groups.
Opportunity
The acquisition of Prime Motor Group marks the largest single acquisition to date by the private equity fund, and provides immediate value to the collective Automotive Retail enterprise. Prime brings immediate geographic diversification, establishing a new regional platform in four New England states. Additionally, Prime brings new brands to Automotive lineup, including core brands Toyota, Honda,and Hyundai, as well as luxury brands Acura, Mercedes-Benz,Porsche, and Volvo. As part of our 100-Day Plan at acquisition, the fund manager will seek to leverage Prime’s bank syndicate to finance inventory across all funds owned dealerships, which is expected to increase the Companies’ EBITDA over time. Additionally, the managers will seek to leverage Prime’s corporate structure.The acquisition of Prime Motor Group is a landmark, transformative moment for the Companies, establishing a significant regional platform, providing brand diversification, considerably increasing the number of franchises under the Automotive Retail enterprise umbrella, and allowing the Companies to tap into Prime’s established infrastructure, which will serve to foster future growth. The fund is proud to partner with David Rosenberg and the Prime Motor Group team to continue to execute on our mission to build a world-class, diversified automotive group.
