Group 1 said the new Kia store is expected to generate $85 million in annual revenue. The auto retailer also divested a Ford dealership near New Orleans.
Group 1 Automotive's acquisitive year continued with the June 1 purchase of Beck & Masten Kia in Tomball, Texas, a few weeks after the Houston company bought three—high-volume Buick-GMC stores in Texas, all owned by retiring John Beck and James Masten.
The auto retailer now has purchased dealerships that are expected to add about $1 billion in revenues this year, with the Houston-area Kia store, which will retain its name, projected to bring in $85 million.
"Kia is a new brand for our Houston platform," Group 1 CEO Daryl Kenningham said in a statement. "Kia America experienced the best first-quarter sales performance in the company's history and Houston is the second-fastest growing major metropolitan area in the U.S."
Interest in Kia stores—is rising across the country, according to Ryan Kerrigan, managing director of Kerrigan Advisors, a dealership sell-side firm in Incline Village, Nev.
"That franchise has had a really good run of product, of profitability," Kerrigan told—Automotive News. "The largest dealership groups and the publics like Group 1 are looking to grow their relationship with Kia."
Kerrigan said his firm, which represented Beck and Masten in both sales, continues to see outsized interest in "business-friendly, growing markets such as Texas," which translates into "significant premiums" paid for those dealerships.
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Kerrigan Advisors is the premier sell-side advisor and thought partner to auto dealers nationwide. The firm advises the industry's leading dealership groups, enhancing value through the lifecycle of growing, operating and, when the time is right, selling their businesses. Kerrigan Advisors has represented some of auto retail's largest transactions and advised more of the largest dealership groups in the US than any other buy/sell firm in the industry. Led by a team of veteran industry experts with backgrounds in investment banking, private equity, accounting, finance and real estate, the firm does not take listings, rather they develop a customized approach for each client to achieve their personal and financial goals. In addition to Kerrigan Advisors' sell-side advisory and capital raising services, the firm also provides a suite of consulting services including growth strategy, market valuation assessments, capital allocation, transactional due diligence, open point proposals, operational improvement and real estate due diligence.
Kerrigan Advisors monitors conditions in the buy/sell market and publishes an in-depth analysis each quarter in The Blue Sky Report®, which includes Kerrigan Advisors' signature blue sky charts, multiples, and analysis for each franchise in the luxury and non-luxury segments.—To download a preview of the report, click here.—The firm also releases monthly The Kerrigan Index™ composed of the seven publicly traded auto retail companies with operations focused on the US market. The Kerrigan Auto Retail Index is designed to track dealership valuation trends, while also providing key insights into factors influencing auto retail.—To access The Kerrigan Index™, click here.—To read the—2023 Kerrigan OEM Survey, click here.—Kerrigan Advisors also is the co-author of NADA's Guide to Buying and Selling a Dealership.