Lithia Motors Inc. continued its autumn shopping spree with the purchase of a large luxury dealership in Sterling, Va.
The acquisition of Sterling Motorcars in the Washington suburb was financed using money Lithia raised in the third quarter through equity and debt offerings. The newly acquired business is expected to generate about $225 million in annualized revenue.
The latest purchase in the public retailer's buying streak marks Lithia's first entry in the state and the Mid-Atlantic market, CEO Bryan DeBoer said in a statement.
"This acquisition accelerates our unique omni-channel strategy and takes us one large step closer to achieving the year one network growth aspiration" of Lithia's five-year plan, he said.
Shares in Lithia gained 1.3 percent to close at $269.46 on Tuesday.
Lithia said last week it acquired nine stores from Keyes Automotive Group in California and Arizona in a deal estimated to generate $1.4 billion in annual revenue.
Sterling Motorcars sells BMW and Mini, as well as Rolls-Royce, Lamborghini and McLaren brands. The latter three would be new franchises for the retailer.
The store was owned by Thomas Moorehead and Joyce Moorehead, said Erin Kerrigan, managing director of Kerrigan Advisors which represented the seller in the transaction.
Lithia, of Medford, Ore., expects over $3.4 billion in estimated annualized revenue growth from acquisitions announced so far this year, bringing the retailer closer to its plan to grow its revenue from acquisitions alone to $20 billion by 2025.
The full plan, which DeBoer refers to as the 50/50 plan, aims to generate $50 billion in annualized revenue and $50 in earnings per share in five years.
Melissa Burden contributed to this report.
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