Click the image above or this link to

the
Blue sKy rePort
TM
a Kerrigan Quarterly
June 2016
Contact Erin Kerrigan: 949-439-6768 | [email protected]
Contact Ryan Kerrigan: 949-728-8849 | [email protected]
19700 Fairchild, Suite 150 Irvine, CA 92612 | 949-202-2200 | www.kerriganadvisors.com
THE BLUE SKY REPORT™
Contact Erin Kerrigan: 949-439-6768 | [email protected]
Contact Ryan Kerrigan: 949-728-8849 | [email protected]
19700 Fairchild, Suite 150 Irvine, CA 92612 | 949-202-2200 | www.kerriganadvisors.com
|
the Blue sKy rePort™
|
dealershiP aCQuisition aCtivity
Following a record 2015, the auto dealership buy/sell market continued at its peak activity level for the first
quarter of 2016. The number of completed transactions nominally increased over 2015’s pace and
included the completion of a few very large acquisitions, namely AutoNation’s purchase of the Allen
Samuels Group in Texas and Fremont Private Holdings purchase of Morrie’s Automotive in Minnesota.
The quarter was also marked by a monumental shift in public market valuations of auto retail stocks. Year
to date, The KAR Index™ (The Kerrigan Auto Retail Index) declined by 11.8% and is down 30% from its
high in June 2015.
THE
KAR INDEX
TM
Methodology
The Kerrigan Auto Retail Index (The KAR Index™) is composed of the seven publicly traded auto retail
companies with operations focused on the US market, namely AutoNation, Penske, Lithia, Asbury, Group 1,
Sonic and CarMax. The purpose is to track this group of companies to identify and assess the drivers
impacting changes in their valuations, with implications for both public and private auto retailers. The KAR
Index™ is weighted by the market capitalization of each company and benchmarked at 100 on 1/3/2000.
496.82
560
540
4/29/2016
520
500
480
460
440
420
400
Jan-16
Feb-16
Mar-16
Apr-16
1
THE BLUE SKY REPORT™
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2
The decline of The KAR Index™ has had a chilling effect on the publics’ acquisition plans. At current
levels, the publics’ blue sky multiples (see Chart 1) are at parity with many private acquisition
opportunities. This is particularly true when factoring in transaction expenses and acquisition integration
costs. As a result, rather than initiating new acquisitions, the publics repurchased over $800 million of their
own stock in the first quarter, three times their US acquisition spending during the quarter and 4.8 times
the level they spent in Q1 2015 (see Chart 2).
Chart 1
Average Public Blue Sky Multiples
Source: SEC Filings for AutoNation, Penske, Lithia, Asbury, Group 1 and Sonic & Kerrigan Advisors Analysis
9.1x
9.1x
7.6x
9.1x
9.1x
7.6x
6.1x
7.6x
9.1x
2014
9.1x
7.6x
2015
2014
9.1x
7.6x
Q1
2016
6.1x
2015
2014
2014
2014
2014
2015
Q1
2014
2015
2016
2015
7.6x
6.1x
6.1x
6.1x
7.6x
6.1x
Q1
2016
2015
Q1
2015
2016
6.1x
Q1 2016
The public company’s blue sky
multiples have declined 30% since 2015.
At current levels, few acquisitions are
accretive to earnings. Thus, the publics
allocated over $800 million to stock
buy-backs, rather than US acquisitions.
2016
Q1Q12016
Chart 2
Public Auto Dealership Group Capital Expenditures in Millions Q1 2016 vs Q1 2015
Source: SEC Filings for AutoNation, Penske, Group 1, Asbury, Sonic, and Lithia
Q1 2015
Q1 2016
the Blue sKy rePort™
|
“We’re buying our stock at a seven times Enterprise Value to EBITDA multiple, and we hear
about car stores coming to market with blue sky numbers that are bigger than that. So we’re
happy to buy our own stock when that situation happens.”
Craig T. Monaghan
President & CEO, Asbury Automotive Group
For public companies to trade at parity with private dealership groups is highly unusual. In most
industries, when public consolidators decline in value, private companies quickly follow suit. This
valuation aberration may be explained by auto retail’s continued fragmentation and domination by private
companies. The publics represent just 8% of industry revenue and a minority of industry acquisitions.
As such, when their stock prices decline, the immediate effect on industry pricing is minimal. That said,
these declines are something to be watched and could be a leading indicator for future blue sky values.
With that backdrop, Kerrigan Advisors sees the following key trends shaping the remainder of 2016.
 Private buyers and new entrants dominate 2016’s buy/sell market
 Acquisition financing terms drive purchase price
 Blue sky values increasingly based on multi-year average earnings
The Blue Sky Report™ is informed by Kerrigan Advisors experience representing our clients in
today’s active buy/sell market, as well as the research conducted by our firm. We hope you find
the information we present informative. We look forward to answering any questions you may have
regarding The Blue Sky Report™ or Kerrigan Advisors’ sell-side services.
3
THE BLUE SKY REPORT™
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Total Acquisition Activity
There were 56 dealership buy/sell transactions completed in Q1 2016 according to The Banks Report.
This compares to 55 transactions in Q1 2015. 2016’s buy/sell activity seems to have hit a plateau,
much like the industry’s SAAR. Kerrigan Advisors expects transaction activity to remain at 2015’s
elevated levels throughout 2016; however, we expect less activity growth than we have seen in prior
years.
Chart 3
Total Number of Completed Dealership Transactions Q1 2016 versus Q1 2015
Source: The Banks Report & Kerrigan Advisors Analysis
Note: Each transaction may include multiple franchises and dealerships. A transaction is defined as a single seller
and single buyer.
55
Transactions
56
Transactions
Transaction activity was flat in the first
quarter of 2016 compared to 2015.
Kerrigan Advisors expects 2016 to be
another record year for buy/sells though
the rate of growth is expected to slow.
Q1 2015
Q1 2016
The number of multi-dealership transactions continued to rise. The first quarter saw 12 multidealership transactions, a 20% increase over the first quarter of 2015 (see Chart 4). Kerrigan
Advisors sees an increasing number of dealership groups coming to market. Group sellers are seeking
to capitalize on their ability to sell to a single buyer and seem to be anticipating the potential closure
of the window to do large platform transactions.
Chart 4
Total Number of Completed Multi-Dealership Transactions Q1 2016 versus Q1 2015
Source: The Banks Report & Kerrigan Advisors Analysis
10
Multi-Dealership
Transactions
12
Multi-Dealership
Transactions
While the number of transactions
completed was flat with last year, the number
of multi-dealership transactions was up 20%
in the first quarter of 2016 compared to 2015.
Q1 2015
Q1 2016
4
THE BLUE SKY REPORT™
|
The size of the groups coming to market continues to rise. Based on Kerrigan Advisors’ current client
base, this trend is expected to continue throughout 2016. As larger groups come to market, the size of the
average transaction is expected to increase.
Chart 5
Average Number of Franchises Represented in Each Multi-Dealership Transaction
Q1 2016 versus Q1 2015
Note: Excludes the Berkshire Hathaway acquisition of Van Tuyl
Source: The Banks Report and Kerrigan Advisors Analysis
4.9
Franchises
The size of the average dealership group
sale has increased considerably since
last year. Excluding Berkshire Hathaway’s
acquisition of Van Tuyl, the average dealership group that sold in the first quarter of
2016 represented nearly 5 franchises, a 75%
increase over the same period last year.
2.8
Franchises
Q1 2015
Q1 2016
Among the franchises being acquired, luxury import franchises represented an impressive 31% of
transactions in Q1 2016 (Chart 6 on the following page), triple their franchise market share (Chart 7 on the
following page) and double their market share in the first quarter of 2015. These luxury sellers capitalized
on sky high blue sky values with the anticipation that luxury multiples will decline in the second half of
2016.
Domestics saw their share of the buy/sell market increase from 35% in 2015 to 45% in Q1 2016, while
non-luxury imports saw their share of the buy/sell market decline from 43% in 2015 to just 24% in Q1
2016. Non-luxury import franchises have seen the sharpest decline in gross profit margins on new
vehicles, which may have contributed to the decline in their share of the buy/sell market. Also, domestic
franchises, which trade at a significant discount to import franchises, are increasingly in demand. Buyers
are attracted to the attractive “ROI” (return on investment) associated with domestic franchises and are
actively seeking these franchises.
5
THE BLUE SKY REPORT™
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Chart 6
Buy/Sell Market Share Q1 2016
Source: The Banks Report & Kerrigan Advisors Analysis
Import Non-Luxury
24%
Domestic franchises saw their buy/
sell market share increase substantially in the first quarter of 2016.
Buyers are attracted to the high ROI
associated with these franchises.
Import Luxury
31%
Domestic
45%
Chart 7
Franchise Market Share in Q1 2016
Source: Automotive News and Kerrigan Advisors Analysis
Import Non-Luxury
24%
Import Luxury
10%
Domestic
67%
Public Acquisition Activity
The public retailers’ US acquisition spending increased 67% in Q1 2016 compared to Q1 2015. Most
of these first quarter transactions were initiated before the decline in the publics’ stock prices. For the
remainder of 2016, Kerrigan Advisors believes the publics’ acquisition spending will focus largely on
smaller tuck-in acquisitions in existing markets and attractively priced group acquisitions.
6
THE BLUE SKY REPORT™
Chart 8
Public Auto Dealership Group Acquisition Spending in Millions
Source: SEC Filings for AutoNation, Penske, Group 1, Asbury, Sonic, and Lithia
Note: This spending EXCLUDES Penske’s commercial truck acquisitions. $ in Millions
Public companies spent an estimated $322 million on auto dealership acquisitions in the US and
abroad in Q1 2016, a 93% increase over Q1 2015.
Kerrigan Advisors expects the publics to continue seeking acquisitions beyond our borders in 2016.
In the first quarter, the publics increased their international spending 10 times over the same period
last year. Currently, international blue sky multiples are lower that US multiples, resulting in highly
accretive acquisitions. Also, the US dollar currently has strong purchasing power abroad, making
these investments more attractive.
Chart 9
Public Auto Dealership Group US versus International Acquisition Spending
Source: SEC Filings for AutoNation, Penske, Group 1, Asbury, Sonic, and Lithia
The publics’ international acquisition
spending, along with stock buy-backs,
will continue to rise relative to US acquisition spending. These transactions
are accretive to earnings, while US
acquisitions are often dilutive, due to
the current pricing disparity between
public and private US dealerships.
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7
THE BLUE SKY REPORT™
Private Acquisition Activity
Private dealership groups continue to represent the largest share of dealership acquirers.
(Note: Kerrigan Advisors categorizes Berkshire Hathaway Automotive as a private group for the
purpose of this report.)
Chart 10
Percentage of Dealership Franchise Acquisitions (Private versus Public) Q1 2016
Source: The Banks Report and Kerrigan Advisors research
Note: If a transaction includes multiple franchises, each franchise is counted in this analysis.
Private
102 Franchises
86%
Public
16 Franchises
14%
Private buyers are the driving force
of the buy/sell market in terms of
number of transactions. With the recent
decline in The KAR Index™, Kerrigan
Advisors expects private buyers to be the
driving force of 2016’s buy/sell market.
Private dealership groups, including newly created groups backed by private equity, continue to
represent the largest share of dealership acquirers. In the first quarter of 2016, private buyers
acquired 102 franchises. Many of last year’s new entrants, including Berkshire Hathaway Automotive,
are actively seeking acquisitions, in stark contrast to the publics. (Note: Kerrigan Advisors will include
new entrants in the private category after they have made their initial investment.)
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8
the Blue sKy rePort™
|
First Quarter Buy/sell trends
While the 2016 buy/sell market is expected to be as active as 2015’s, Kerrigan Advisors anticipates
greater pricing disparity as industry growth plateaus and dealership earnings come under pressure. There
seems to be a growing divide between the bid/ask spread in the buy/sell market. Sellers have very high
pricing expectations, particularly in the luxury market, and buyers are increasingly challenged to achieve
their return on investment requirements.
With this in mind, Kerrigan Advisors sees the following buy/sell trends shaping 2016’s market.
 Private buyers and new entrants dominate 2016’s buy/sell market
 Acquisition financing terms drive purchase price
 Blue sky values increasingly based on multi-year earnings averages
Private Buyers and New Entrants Dominate 2016’s Buy/Sell Market
Private buyers and new entrants are expected to dominate the 2016 buy/sell market. With the
significant decline in the publics’ market multiples (see Chart 11), the public companies will be less
active in the buy/sell market this year and will focus their attention on simple and attractively priced
stock buy-backs. This creates a unique opening for private dealership groups and new entrants to
make their mark on the 2016 buy/sell market.
Chart 11
Public Valuation Metrics
Source: Kerrigan Advisors Analysis and Yahoo Finance
Publics Estimated Blue Sky Multiples Q1 2016
($ in millions)
Market Cap (as of 3/31/2016)
AutoNation
$4,813
Net Assets
(99)
Penske
Group 1
$3,233
$1,297
-
-
Asbury
$1,326
(63)
Estimated Blue Sky
4,714
3,233
1,297
1,262
Adjusted EBIT
Blue Sky Multiple
$707
6.7x
$507
6.4x
$220
5.9x
$251
5.0x
6.5x
7.0x
7.8x
11.0x
9.6x
7.8x
Source: Kerrigan Advisors and SEC Public Filings
Enterprise Value/EBITDA
P/E Multiple
Sonic
$847
(114)
732
Lithia
$2,235
(439)
Total
$13,750
(715)
1,796
13,035
$195
3.7x
$270
6.7x
$2,150
6.1x
6.9x
5.8x
11.9x
7.4x
9.2x
8.3x
12.0x
10.0x
“I think we are going to continue being an opportunistic buyer. I would say that as we
look at the business today in the U.S., the multiples are pretty high. And unless they are
strategic and would be contiguous to where we are, we would probably have our pencils
down at the moment.”
Roger Penske
Chairman, Penske Automotive
1st Quarter Earnings Call
9
THE BLUE SKY REPORT™
|
10
Large private dealership groups and new entrants have tremendous access to capital, both from their own
balance sheets and from very willing lenders active in today’s financing market. These buyers are more than
capable of completing the largest industry transactions, as evidenced by Berkshire Hathaway’s
acquisition of Van Tuyl. Given the increasing number of large groups coming to market, Kerrigan Advisors
expects private buyers and new entrants to make headlines throughout the year, as they announce the
acquisition of several large dealership groups.
Acquisition Financing Terms Drive Purchase Price
Seller’s pricing expectations remain very high. Increasingly, buyers are deploying significant amounts of
leverage to meet these expectations and achieve a target return on equity. The higher the acquisition
financing, the more buyers are able and willing to pay in today’s low-interest rate environment.
Kerrigan Advisors has noticed that 50% financing on blue sky and nearly 100% financing on real estate
is becoming the standard for acquisition leverage. As the buy/sell market becomes increasingly reliant on
leverage, it will inherently be more sensitive to credit market fluctuations. With the expectation of at least
one rate hike coming from the Federal Reserve this year, Kerrigan Advisors believes the buy/sell market
may be more exposed to interest rate fluctuation than in years past, when financing played a smaller role
in blue sky and real estate pricing.
Note: In order to finance a large portion of a transaction, buyers need to feel confident in the future cash
flow of the dealership. Financing adds a level of risk to any transaction and can put significant pressure on
a dealership’s future earnings and capitalization.
THE BLUE SKY REPORT™
|
11
Blue Sky Pricing Increasingly Based on Multi-Year Average Earnings
As earning growth expectations decline, buyers are increasingly sensitive to pricing off of peak
earnings (see Chart 12). Buyers are beginning to price their blue sky offers based on an average of the
last three year’s earnings, rather than the most recent performance. There is a growing skepticism within
the buyer community about their ability to maintain current earnings levels. This is not surprising given
industry headwinds evidenced by rising inventories and lower vehicle gross margins.
Chart 12
Average Dealership Earnings
Source: NADA
New
Normal or
Peak?
$1,400,000
wth
5
-201
l Gro
2008 d Annua
nde
pou
$1,200,000
$1,000,000
23%
2000-2007
Average Earnings $542,881
$800,000
$1,167,545
Com
$600,000
$400,000
$279,685
$200,000
$0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
LTM
THE BLUE SKY REPORT™
|
12
Kerrigan Advisors Blue Sky Charts
Kerrigan Advisors Blue Sky Charts lay out the high, average and low blue sky multiples for each franchise
in the luxury and non-luxury segments. Most dealerships are valued based upon their assets plus blue sky.
Kerrigan Advisors’ blue sky multiples are increasingly applied to the average of the last three year’s
earnings, rather than the most recent performance. This trend is expected to continue as industry
earnings growth slows.
The Kerrigan Advisors’ blue sky multiples are based on our view of franchise values in the current buy/sell
market. These multiples should be considered guide posts to estimate a dealership’s blue sky value;
however, each dealership has its own unique valuation drivers and significant analysis should be
done to determine the market clearing price for blue sky.
The high, average and low multiples reflect the variability in dealership values. In our experience, there are
four key factors that drive where a franchise will sell within the range: (i) earnings growth expectations;
(ii) buyer demand; (iii) real estate, and (iv) market preference. The combination of these four factors plays a
major role in the blue sky multiple a buyer is ultimately willing to pay.
Factor One: Earnings Growth Expectations
Higher Growth = Higher Multiple: Underperforming dealerships provide an opportunity for higher earnings
growth. A dealership that is underperforming, meaning its profitability and/or sales are below market
expectations, often commands a higher blue sky multiple because the buyer believes he/she can grow
profits at an above-average rate by reducing expenses, increasing gross profit or growing sales. Also,
dealerships in high growth markets have higher earnings growth expectations. By way of example, Texas,
Arizona and Florida are high growth markets where dealerships often command premium multiples.
Lower Growth = Lower Multiple: Over-performing dealerships can experience below average earnings
growth post-sale. Ironically, a dealership that is over-performing, meaning its profitability and/or sales are
above market expectations, often commands a lower blue sky multiple. Also, dealerships in slow growth
markets, such as many smaller Midwestern markets, can expect slower earnings growth.
Factor Two: Buyer Demand
Higher Demand = Higher Multiple: There are significantly more buyers seeking acquisitions in big cities than
there are sellers willing to part with their highly valuable, metro stores. High buyer demand, with limited
seller supply, drives up price (Economics 101).
Lower Demand = Lower Multiples: Less demand means less competition and lower blue sky multiples. As
an example, there are fewer buyers seeking dealerships in smaller/rural markets, resulting in lower multiples.
THE BLUE SKY REPORT™
|
13
Factor Three: Real Estate
Image Compliant Facilities & Low Rent = Higher Multiple: Image compliant dealerships with low rent
command higher multiples. These dealerships are highly attractive to buyers because they require no
additional investment and they have an attractive rent factor, thus low fixed expenses and less risk.
Note: In 2013, the average dealership according to NADA had a rent factor of 7.4% of gross profit. In
general, if a dealership is image compliant and its rent to gross profit is below 7.5%, then it is considered to
have low rent. Many buyers consider a rent to gross profit margin above 10% high.
Real Estate Investment Required and/or High Rent = Lower Multiple: Dealerships that require major real
estate investments or have high rent command lower multiples. Most buyers are not looking for real estate
development projects. When a dealership requires a significant real estate investment, both known and
unknown costs are created. These costs result in increased future rent, which could reduce future earnings.
As such, buyers often price non-image compliant franchises or franchises with high rent at lower multiples
to take into account the risks to earnings.
Factor Four: Market Preference
Highly Suitable Franchise for a Particular Market = Higher Multiple: Franchises that are highly suitable for
a particular market receive higher multiples. For example, a domestic franchise located in a truck market,
such as Colorado, is more valuable than the average domestic franchise in the U.S., and thus will likely
command a higher multiple. This is due to the fact that unit sales volume and dealership earnings in those
markets are expected to be far above the average domestic franchise.
Unsuitable Franchise for a Particular Market = Lower Multiple: Franchises that are unsuitable for a particular
market receive lower multiples. For example, a luxury franchise in a small city with fewer high-income wage
earners will be much less valuable than the average luxury franchise located in a major metro.
In each case, these factors coalesce to push dealership multiples up or down. Sometimes they can
counter-balance one another. For instance, an underperforming dealership located in a low demand
market could command an average franchise multiple as the factors counterweight each other.
the Blue sKy rePort™
|
For the first quarter of 2016, Kerrigan Advisors’ blue sky multiples are unchanged for non-luxury
and marginally reduced for top luxury. We continue to believe blue sky multiples are at peak levels
and are unlikely to rise in 2016. Our thinking is informed by the changes we see in the public
markets, relative to the private sector. We believe the currently depressed public multiples may be
a leading indicator for future private sector valuations. Afterall, public companies are
marketed-to-market every business day. Their valuations are informed by thousands of
investors and the highly efficient and liquid capital market. By contrast, the private sector is slow
to change. Buy/sell transactions take months, not minutes. Private valuations react slowly to
market movements, as sellers hesitate to reduce their pricing expectations.
Non-luxury franchise multiples are unchanged in large part due to continued demand for these
franchises. Investors are increasingly attracted to non-luxury franchises due to their lower
aluations and higher ROI. Buyers are particularly attracted to high volume, profitable domestic
franchises which provide attractive returns, particularly during this prolonged period of low gas
prices.
As for luxury franchises, Kerrigan Advisors reduced its top multiple on Lexus, Mercedes and BMW
by -.13 this quarter. This is a reflection of a widening gap between sellers’ and buyers’ pricing
expectations for top luxury franchises. This reduction is also a reflection of a shrinking buyer pool
for top luxury franchises. The publics are priced out of the luxury market and new entrants are
focused on lower multiple/higher ROI franchises. This leaves the deepest pocketed buyers out of
the high priced luxury market.
“I think many of you saw a large [luxury] Northwest group [Kuni] that announced a
sale a couple of weeks ago…It’s a wonderful group but it just doesn’t fit our ROE
thresholds...”
Bryan DeBoer, President & CEO
Lithia Motors
1st Quarter Earnings Call
While there are well-funded private groups willing and able to complete large, luxury acquisitions
(Holman’s recent acquisition of Kuni is evidence), these groups are working within the limits of
their own balance sheets and spending their personal capital. Fewer will be comfortable paying
the high price tags demanded by sellers of top luxury, particularly as luxury sales and margins
come under pressure and luxury manufacturers demand expensive facility upgrades. Kerrigan
Advisors does not expect the owners of these top luxury franchises to accept significantly lower
prices, as such we expect fewer top luxury franchises to trade in the second half of 2016.
14
the Blue sKy rePort™
Chart 13
Kerrigan 2015 Blue Sky Multiples – Non-Luxury Average
Source: Kerrigan Advisors Analysis
Chart 14
Kerrigan 2015 Blue Sky Multiples – Luxury Average
Source: Kerrigan Advisors Analysis
|
15
THE BLUE SKY REPORT™
Chart 15
Kerrigan Advisors Blue Sky Chart and Analysis: Non-Luxury
Source: Kerrigan Advisors Analysis and Automotive News
|
16
the Blue sKy rePort™
|
Chart 16
Kerrigan Advisors Blue Sky Chart and Analysis: Luxury
Source: Kerrigan Advisors Analysis and Automotive News
Franchise
Buyer Demand
Market Share Change Q1
2016 vs Q1 2015
Change in Sales
Q1 2016 vs Q1
2015
Sales Per
Franchise
Average Dealership
Profitability
Moody's Credit
Rating
High
-7%
-4%
1,263
Consistently High
Aa3
High
-13%
-10%
833
Consistently High
A2
High
-4%
-1%
907
Consistently High
A3
High
+1%
+5%
593
Consistently High
A2
High
+4%
+7%
259
Consistently High
A2
High (LR)
+19% LR
+12% Jag
+23% LR
+15% Jag
498 LR
122 Jag
Consistently High
(LR)
Ba2
Low
-8%
-4%
555
Consistently Low
A1
Low
-7%
-3%
631
Consistently Low
A3
Low
-7%
-4%
154
Consistently Low
Ba1
Low
+15%
+19%
221
Consistently Low
Baa2
17
THE BLUE SKY REPORT™
|
In closing, we hope you find this Kerrigan Quarterly informative. If you are a buyer in today’s market,
Kerrigan Advisors welcomes the opportunity to learn about acquisition criteria and include you in our
proprietary Buyer Database. If you are seller, we look forward to having a confidential conversation with
you about your dealership’s value and potentially serving you in the sale of your business.
At Kerrigan Advisors, we run a professional, discreet and competitive dealership sale process to determine
the highest market-clearing price for our clients’ valuable franchises. We manage our client’s sale from
beginning to success. In our view, dealerships and dealership groups are far too valuable to be sold any
other way.
We hope to see you at one of our upcoming speaking events. We look forward to scheduling a
confidential conversation with you in the near future.
18
the Blue sKy rePort™
Kerrigan advisors 2016 sPeaKing events
JD Power Summit
Las Vegas, Nevada
March 31st
Texas Auto Dealers Association 100th Anniversary Celebration
Austin, Texas
April 17th
Driving Sales President’s Club
Miami, Florida
May 5th
American International Automobile Dealers (AIADA) Summit
Washington DC
May 10th
National Association of Minority Auto Dealers (NAMAD) Conference
Miami, Florida
July 21st
AICPA Auto Dealer Conference
Las Vegas, Nevada
October 10th
Presentations available on www.kerriganadvisors.com
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19
THE BLUE SKY REPORT™
|
Kerrigan Advisors RECENT TRANSACTIONS
Kerrigan Advisors is pleased to announce the successful sale of it’s client, San Francisco Honda.
“After 80 years and three generations in the auto retail business, we
embarked on the sale of our dealership with the goal of finding the right
buyer. After careful evaluation, we chose Kerrigan Advisors to guide us in
the sale process. We knew this would be a challenging transaction, given
our downtown metro location and a difficult, expensive real estate
challenge to be solved. Erin Kerrigan and her team were fabulous in
leading the process to a successful conclusion.”
John Boas, Dealer, San Francisco Honda
20
In 2015, Kerrigan Advisors’ completed transactions
representing $400 million in client proceeds.
“Kerrigan Advisors was instrumental in positioning our
dealership group for maximum return on our investment. We
would not have received the offer that we did without their
valuable insight into the market, and the correct positioning
of our dealership group. Having them as my partner gave me
the confidence to move forward with the sale.”
Patti Swope, former owner of Sam Swope Auto Group
“Working with Kerrigan Advisors got us top dollar for our
dealerships and property. Their expertise in handling the
negotiations of the transaction was critical to us maximizing
our deal.”
Bob Lanphere, former owner of Renton Honda and Kia
“I heartily recommend Kerrigan Advisors if you are considering
a sale of your dealership, particularly if you expect and
appreciate first rate professional advice and excellent value,
with a high degree of confidentiality.”
David Morris, former owner of Mercedes Benz of Edmonton West
“Kerrigan Advisors did an exceptional job selling our dealership. Erin Kerrigan led a highly effective and confidential sale
process that resulted in an outstanding outcome. I highly
recommend her for her integrity, client commitment and
professionalism. In my opinion, Kerrigan Advisors is the best
representative a dealer could have!”
Johnny Harrison, former owner of Lexus of Glendale
Dealerships are Far Too Valueable to be Sold Any Other Way
We Serve Sellers. We Know Buyers.
Kerrigan Advisors is focused on serving dealership sellers. We customize
our sale process to maximize our client’s transaction proceeds. The firm’s
leadership has advised on over $2 billion worth of transactions in auto
retail, private equity and investment banking. We leverage our proprietary
Buyer Database and extensive industry relationships to identify the right
buyer for our client’s business. Our sale process is highly professional,
actively managed, competitive, and – most important – discreet.
Kerrigan Advisors
19700 Fairchild, Suite 150
Irvine, CA 92612
949-202-2200
www.kerriganadvisors.com
Erin Kerrigan is Managing Director of Kerrigan Advisors, which she founded in 2014. Prior to
founding Kerrigan Advisors, Ms. Kerrigan headed Presidio Automotive. During her time at Presidio,
the firm represented dealer clients in numerous multi-million dollar transactions. Prior to Presidio,
she was a Senior Vice President at AutoStar, a subsidiary of iStar Financial (NYSE:SFI), where she
led transaction origination. Early in her career, she was dealer operator of her family’s dealership,
which she sold in 2006. Ms. Kerrigan is a recognized industry expert on dealership valuation, real
estate and buy/sells, and is a frequent speaker at leading auto retail events and conferences,
including NADA (#1 speaker in 2012), AICPA, NADC and Driving Sales’ President’s Club. She has
also led webinars for NADA and Automotive News on the topic of buy/sells and she writes a monthly
column and blog for Dealer Magazine. Ms. Kerrigan earned her undergraduate degree from
Northwestern University and her Masters in Business Administration from The UCLA Anderson
School of Management.
Contact Erin Kerrigan: 949-439-6768 / [email protected]
Exceptional Sell-Side Representation
for Auto Dealers
Ryan Kerrigan is Managing Director of Kerrigan Advisors. Mr. Kerrigan oversees strategy, finance
and modeling for Kerrigan Advisors and lead the firm’s private equity and family office advisory
practice. He has extensive experience in private equity investing, auto retail, management consulting
and executive management. In addition to his auto sector experience, Mr. Kerrigan has served as
CEO of several companies during his career, including Elevate Property Services and Alta
Environmental, companies he currently owns. During his career, he also served as Managing
Director at Serent Capital, a $250mm private equity fund investing in middle market companies and
as General Manager of his family’s auto dealership. Early in his career, Mr. Kerrigan spent four
years as a management consultant at McKinsey & Company, where he advised Fortune 500
companies on growth strategies, organizational issues, pricing and business valuation. Ryan has an
MBA from Stanford University’s Graduate School of Business and an MSFS from Georgetown
University’s School of Foreign Service. He graduated summa cum laude from the University of
Notre Dame with a BBA in Finance.
Contact Ryan Kerrigan: 949-728-8849 / [email protected]
.