Auto-dealer chain backs out of massive $1 billion deal for luxury stores

Asbury Automotive Group Inc. is pulling the plug on one of the richest acquisitions of car dealerships in history and stocking up on cash instead.

Image used for representational purpose only.
Image used for representational purpose only.

The Duluth, Georgia-based retailer has delivered notice to Park Place Dealerships that it’s terminating the $1 billion, all-cash purchase pact they reached in December, according to a regulatory filing. Asbury will pay Park Place $10 million in damages.

Closely held Park Place owns 17 franchises mainly selling European luxury-brand vehicles including the Mercedes-Benz, Jaguar, Land Rover and Porsche brands. When Asbury announced plans for the acquisition late last year, Chief Executive Officer David Hult called Park Place “one of the best and most efficient operators of luxury stores in the industry."

The deal collapsed as the auto industry joined much of the rest of the U.S. economy in grinding to a halt to curb the spread of the coronavirus. Researcher IHS Markit said Wednesday it expects sales will plunge around the globe and recover slowly.

Asbury said in its filing that it has borrowed $237 million from a revolver and $110 million from its used-vehicle floor plan facility. As of Monday, the company had about $566 million in cash and assets on its balance sheet.

First Published Date: 26 Mar 2020, 08:41 AM IST
Shopping Bag Shop Now
5% OFF
Godrej aer O – Hanging Car Air Freshener | Car Accessories | Cool Aqua (7.5g)
Rs. 94 Rs. 99
70% OFF
VENO Portable High Power 2 in 1 Car Vacuum Cleaner | USB Rechargeable Wireless Handheld Car Vacuum Cleaner Traveling, Camping Reusable and Sustainable (2 in 1 Vacuum Cleaner)
Rs. 899 Rs. 2,999
4% OFF
Godrej aer O – Hanging Car Air Freshener | Car Accessories | Musk After Smoke (7.5g)
Rs. 95 Rs. 99
SHAYONAM Dent Removal Kit - Powerful Car Dent Repair Kit - Suction Cup Dent Puller Handle Lifter and Dent Repair Puller for Car Body Dent, Glass, Tiles and Mirror (Plastic)
Rs. 349

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city
By clicking "View Offers" you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.