Private-equity firm GPB Capital thrives under the radar


Kenny Ross Subaru is a part of Kenny Ross Automotive Group. GPB purchased a majority stake in June.

GPB Capital

What: New York private-equity firm
Holdings: Under contract with majority stakes in 66 dealerships
The place: New York, New Jersey, Connecticut, Texas, California and Pennsylvania
Numbers: $1.2 billion in belongings; greater than 1,000 buyers
M.O.: Requires sellers preserve 15-25% stake, keep and run operations

In the previous 4 years, GPB Capital has quietly grown by shopping for unique model dealerships in small to midsize markets, and bigger shops or teams in metro areas.

At this time, the New York private-equity group is under contract and owns a majority stake in 66 dealerships promoting 25 manufacturers in six states. If it launched figures, GPB would rank in the prime 10 on Automotive Information’ record of the prime 150 dealerships teams based mostly in the U.S., based mostly on new-vehicle retail gross sales, asserted Scott Naugle, GPB’s managing director of automotive technique.

“When it comes to income, we might be proper in entrance of Staluppi, and rising,” he mentioned. Staluppi Auto Group ranks No. 9 with retail gross sales of 67,731 new automobiles in 2016 and income of $three.04 billion.

On June 27, GPB purchased a majority stake in 9 Kenny Ross Automotive Group dealerships in the Pittsburgh market. Final week, it opened a brand new Buick-GMC level on Staten Island, N.Y.

Naugle: “We’re retailers.”

“Our philosophy has been keep under the radar, however when folks hear ‘personal fairness [is] shopping for dealerships,’ they assume we have now deep pockets, that we are going to purchase something and we’ll overpay,” Naugle informed Automotive Information. “We’re very discretionary patrons. We do not purchase turnaround shops. We wish to preserve the proprietor concerned. We’re at that time the place folks know who we’re, however we would like them to perceive who we’re.”

GPB Capital manages $1.2 billion in belongings. Its automotive workforce has trade veterans together with former sellers, whom Naugle declined to call. Naugle, an authorized public accountant by commerce, spent 20 years with Holman Automotive Group in monetary positions. Then he labored at DCH Auto Group as director of company finance and accounting for one 12 months earlier than Lithia purchased it in 2014.

“We’re not Wall Road folks at GPB Automotive. We’re retailers,” mentioned Naugle. “That is our pedigree.”

That helped persuade Jimmy Ross to promote the majority stake of the group his father began in 1954. “They’ve folks accustomed to the automobile enterprise, so that they’re simple to speak to and versatile,” mentioned Ross, former chairman of Kenny Ross Auto and now managing member.

Phrases of the deal weren’t disclosed. However GPB’s offers normally require the vendor to retain a 15 to 25 % stake and preserve working the enterprise, Naugle mentioned. The identify on the constructing would not change.

“Once we go into these offers, we do not count on to purchase anybody out,” Naugle mentioned. “Our philosophy is that they’ve created one thing particular, particular sufficient for us to purchase them, so why would we need to eliminate them?”

GPB’s dealerships are concentrated in the New York metro space, together with Invoice Kolb Jr. Subaru in Orangeburg; Rockville Centre GMC; and Nissan of Backyard Metropolis. It additionally owns the FX Caprara group, with seven shops in northern New York state; World Jeep-Chrysler-Dodge-Ram in Shrewsbury, N.J.; and World Subaru in Tinton Falls, N.J., Ron Carter Auto Group in Alvin, Texas, and shops in California, Pennsylvania and Connecticut.

GPB Capital

What: New York private-equity firm
Holdings: Under contract with majority stakes in 66 dealerships
The place: New York, New Jersey, Connecticut, Texas, California and Pennsylvania
Numbers: $1.2 billion in belongings; greater than 1,000 buyers
M.O.: Requires sellers preserve 15-25% stake, keep and run operations

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