What is going on with Asbury Automotive Group?

Asbury Automotive Group (ABG) announced today, September 29, that it has signed a definitive agreement with Larry H. Miller Group of Companies, or LHM Group, to acquire Larry H. Miller dealers, as well as Total Care Auto, Powered by Landcar. At 9:40 a.m. EDT this morning, ABG stock rose 0.64% in value, to $ 200.10 per share.

What does this mean for ABG?

Larry H. Miller Dealerships is the eighth largest dealer group in the United States. Asbury Automotive Group expects its definitive agreement with LHM Group to generate significant value for the company’s shareholders by adding approximately $ 5.7 billion in annualized revenue.

“This acquisition is a unique opportunity to rapidly expand Asbury’s presence in these high growth, high growth Western markets from day one, with this impressive group and its rich history,” said David Hult, CEO of Asbury.

“Larry H. Miller Dealerships is a well-run operation… We are excited to expand our presence in those states which we believe offer attractive economic and population growth opportunities while expanding our geographic reach,” continued Hult. “Our now national presence, complemented by our digital purchasing capabilities in Clicklane [for buying and selling cars], creates a truly expansive omnichannel dealer platform. “

Asbury Automotive Group is a regional grouping of automobile dealerships that went public in March 2002. The company operates more than 90 stores with associated parts and service departments and 25 collision centers. About 80% of new vehicle revenue comes from luxury and import brands. Asbury also offers third party finance and insurance products. Asbury operates in 9 states (primarily Texas and the Southeast) and the company entered Colorado in 2019. Its store brands include David McDavid and Park Place in Texas, Plaza in Missouri, and Nalley and Crown in the south. -is of the United States. Asbury generated $ 7.1 billion in revenue in 2020 and is based in the Atlanta area.