Kerrigan Advisors, an Irvine, CA-based advisory firm specializing in auto dealership mergers & acquisitions, has added a new turnaround and restructuring offering to its consulting practice.
US auto dealers are under extreme pressure from the Covid-19 crisis, as lockdowns and social distancing measures have resulted in a demand crash, while most dealerships have been closed as non-essential services. US car sales declined by 39% in March, and are trending down 55% for the first two weeks in April, according to JD Power.
The trying conditions will inevitably lead to a sharp increase in the need for financial and restructuring support in the industry. Kerrigan Advisors will aim to satisfy some of the demand for such services, leveraging its team’s experience helping businesses with restructuring during the 2008 financial crisis.
“Nearly 20% of auto dealerships closed their doors as a result of the Great Recession of 2008 with devastating impacts on local economies. Without serious planning and action, the current crisis could precipitate more closures of US auto dealerships,” said Erin Kerrigan, founder and managing director of Kerrigan Advisors. “Kerrigan Advisors is dedicated to putting our expertise to work to help the nation’s auto dealers successfully navigate this very difficult crisis and avoid closures.”
Kerrigan Advisors was founded in 2014 and is a leading sell-side advisor to auto dealers in the US. In addition to sell-side advisory and capital raising services, the firm offers consulting in transactional due diligence, growth strategy, operational improvement, and real estate analysis. The boutique consultancy has a team of nine experts.
The firm is led by managing directors Erin and Ryan Kerrigan. Erin was previously the head of auto investment banking at The Presidio Group and an SVP at AutoStar, a part of real estate investment trust (REIT) iStar Financial. At Autostar, she led nearly a half billion dollars’ worth of workouts for the REIT during the 2008 recession.
Ryan is a long-time executive in the private equity industry. He also previously spent time as a management consultant at McKinsey & Company, working on strategy and operations engagements.
The firm’s new restructuring and turnaround offering will help clients with strategic planning and operational performance issues. Key services will include managing lender, creditor, and landlord negotiations, developing post-default business plans, implementing operational restructuring, developing cost reduction initiatives, and implementing cash conservation guidelines.
“Auto retailers are going to face some serious headwinds in the coming months. Metrics-based operations, cost control, and cash flow planning will all be critical in managing through this cycle,” said Ryan Kerrigan.
Kerrigan Advisors is the leading sell-side advisor and thought partner to auto dealers nationwide. Since its founding in 2014, the firm has led the industry with the sale of over 280 dealerships representing $9 billion in client proceeds, including the third largest transaction in auto retail history – the sale of Jim Koons Automotive Companies to Asbury Automotive Group. The firm advises the industry’s leading dealership groups, enhancing value through the lifecycle of growing, operating and, when the time is right, selling their businesses. Led by a team of veteran industry experts with backgrounds in investment banking, private equity, accounting, finance and real estate, Kerrigan Advisors does not take listings, rather they develop a customized sales approach for each client to achieve their personal and financial goals. In addition to the firm’s sell-side advisory services, Kerrigan Advisors also provides a suite of consulting and investor services including growth strategy, market valuation assessments, capital allocation, transactional due diligence, open point proposals, operational improvement and real estate due diligence.
Kerrigan Advisors monitors conditions in the buy/sell market and publishes an in-depth analysis each quarter in The Blue Sky Report®, which includes Kerrigan Advisors’ signature blue sky charts, multiples, and analysis for each franchise in the luxury and non-luxury segments. To download a preview of the report, click here. The firm also releases monthly The Kerrigan Index™ composed of the seven publicly traded auto retail companies with operations focused on the US market. The Kerrigan Auto Retail Index is designed to track dealership valuation trends, while also providing key insights into factors influencing auto retail. To access The Kerrigan Index™, click here. To read the 2023 Kerrigan Dealer Survey, click here. To read the 2024 Kerrigan OEM Survey, click here. Kerrigan Advisors also is the co-author of NADA’s Guide to Buying and Selling a Dealership.
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