The 2021 buy-sell year was notable for four supersize acquisitions that helped frame the latest wave of dealership consolidation. Deals of that size did not happen in 2022.The dealership buy-sell market in 2022, following what is considered the biggest year for acquisitions in auto retail industry history, bustled with a different kind of busy.The 2021 buy-sell year was notable for four supersize acquisitions by the publicly traded auto retailers that helped frame the latest wave of dealership consolidation.
Deals of that magnitude did not happen in 2022. Instead, it was private dealers and groups who collectively were the most active buyers, often completing deals for just one or two dealerships at a time. And amid steady deal activity, the number of transactions in 2022 actually outpaced 2021's total.
***Kerrigan Advisors, a sell-side dealership advisory firm in Incline Village, Nev., said in its 2022 annual Blue Sky Report that 51 percent of the publicly traded auto retailers' capital was allocated to stock buybacks, more than double what it was in 2021. Kerrigan Advisors said the publics' falling market valuations throughout most of 2022 led to fewer dealership acquisitions.
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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 275 dealerships representing nearly $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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