The deal includes 20 franchises at 17 rooftops, all in New York. The Atlantic dealerships and storage facility are expected to generate an estimated $1.6 billion in revenue and $38 million in net income on an annualized basis in 2021, LMP said. The deal will be partially financed, which includes seller financing, and funded through company cash. The group will retain ownership of the real estate, which LMP will lease for five years, Staluppi Sr. said.
“It’s a good opportunity for them; it’s a good opportunity for my people,” Staluppi Sr. said. “None of my business will change. All of the employees stay in place. I’m still the boss.”
If all of the acquisitions LMP announced this year close, including Atlantic Auto Group, LMP’s 26 rooftops will represent 33 franchises: five Toyota, two Lexus, three Honda, one Subaru, six Hyundai, three Genesis, three Kia, four Chevrolet, two GMC, two Cadillac and two Buick. The group will also have six used-only standalone stores, including the original store in Florida.
Tawfik told investors Monday that LMP plans to add 30 to 40 stores in 2021.
LMP, which went public last December, began in late 2017 with a business model centered around a “flexible lease” offering, wherein the company purchased new vehicles at fleet prices and used-vehicle inventory at auction to offer for subscription. The company would then sell the off-subscription vehicles.
LMP shares rose 3.1 percent to close at $36.17 on Monday.
This year, LMP announced deals to buy all or part of nine franchised dealerships and three used-vehicle stores in four Southern states for a total of about $120 million. These stores are expected to close starting at the end of November.
Together with the Atlantic Auto Group, LMP’s planned acquisitions would fetch the fledgling public company $2.2 billion in annualized revenue in 2021 and would expand its employee count to over 1,600 from 30 people today. The company also expects to earn about $70 million in pretax income from the acquisitions.