By Alysha Webb, Editor and Publisher
This week we have an installment in the series by Richard Kotzen of Crowe Horwath looking at non-traditional buyers in the buy sell world. Private equity groups and family offices have different strengths and weaknesses as dealership owners, he notes. One weakness they potentially share, however, and that may be of concern to the manufacturer who must approve the deal, is a lack of dealership management knowledge.
Another class of non-traditional buyers, wealthy entrepreneurs who have made money on Wall Street and are looking to diversify, have “considerable business acumen,” demonstrated by their success, he says, and manufacturers may be more comfortable with them. Warren Buffett aka Berkshire Hathaway is a perfect example of that type of investor. We shall see if his business acumen extends to dealerships.
One buyer that manufacturers are very comfortable with is another dealer whom they have chosen to acquire a franchise. I talk to a seller in such a situation this week. Ron Petell took a voluntary buyout offer from General Motors for his GMC Buick Chevrolet franchises in Maine; the GMC franchise was awarded to a nearby dealer. Petell figures it is part of a consolidation strategy for GMC though General Motors naturally denies the existence of such a plan.
We also have the latest Transaction News.
Enjoy!
