DCG Acquisitions Closes 17th Car Dealership Deal in Record Year | Franchise Mergers and Acquisitions
Ken Garff Enterprises is the new owner of Ron Carter’s Cadillac and Ron Carter’s Hyundai, two Houston auto dealer franchises that have been renamed Big Star Cadillac and Big Star Hyundai. The deal secured by DCG Acquisitions takes place during a record year for the M&A company specializing in the automotive industry.
“Usually 15 to 16” per year is the acquisition speed of DCG. “This year 28 to 37,” said Dave Cantin, Founder and CEO. “What this year turns out to be the greatest year and activity we have ever seen in the world of mergers and acquisitions.”
The succession plan was the reason for the sale. “Any trader would like to have his son or daughter take it over; Unfortunately, this was not the case with this acquisition, ”said the Ron Carter Group, owned by Rob Abernathy and Donald Hudler, looking for an outside buyer.
“This was a big acquisition,” said Cantin of the deal, which was the 17th time this year. “The Ron Carter dealers are well known in Texas and Houston. The buyer is one of the largest private automobile groups in the country, ”said the Ken Garff Auto Group.
“John Garff, the President and CEO, is a good friend. It’s her second big purchase from us this year. They were busy spending a lot of money in the industry and buying a lot of dealerships, ”he said.
“It’s a perfect storm for buyers and sellers; The acquisition costs are lower than ever because of the low interest rate, ”said Cantin. At the same time, “traders are making incredible profits month after month. It will create a very high profit multiple on the sale of the business. “
Car dealerships are a unique type of franchise and opportunities to buy one are rare. “You can have all the money in the world, you can’t buy a car dealership. They have to be approved by the manufacturer, ”he said. “Each dealership is an individual sales and service franchise agreement. The manufacturer may approve you. “
Cantin used to own car dealerships, but sold them in their early 30s and got into the M&A space. In 2017, he closed the second largest car purchase / sale in US history, Prime Motor Group, which consists of over 30 dealers. According to Cantin’s biography, it is the second largest automobile acquisition after Warren Buffett’s acquisition of the Van Tuyl Group in 2015, which eventually became Berkshire Hathaway Automotive.
“Being second to Warren isn’t the worst thing in the world,” said Cantin. “He’s a great mentor. I look up to him, not for the money he makes, but for the money he gives. We give back a percentage of every dollar of gross profit to childhood cancer. I’m a leukemia survivor, that’s very important to me. “