Asbury Automotive Group Inc., the owner of 84 auto dealerships mostly in the southeastern U.S., sold its heavy truck business to commercial-vehicle seller Rush Enterprises Inc. to focus on its passenger car sales.
The transaction is expected to be completed in the first quarter next year, Duluth, Georgia-based Asbury said today in a statement. Rush said the purchase will expand its network to 64 truck centers and that it expects to pay in cash.
“The sale of our heavy truck business represents a strategic decision to exit a non-core business,” Asbury Chief Financial Officer Craig Monaghan said in the statement. The business, which operated as Nalley Motor Trucks, was a part of the company before Asbury’s initial public offering in 2002, Monaghan said in an interview.
Asbury said separately that its board authorized a $25 million buyback of common stock and closed on the acquisition of Greenville Automotive Group. The Lexus, Toyota, Jaguar, Porsche, and Volvo brand stores in Greenville, South Carolina, may generate annual revenue of about $125 million, Asbury said.
Asbury purchased a St. Louis-area Mercedes-Benz store that closed in October. The company may “spend a little time absorbing these stores” before making more acquisitions, Monaghan said.
Asbury rose 26 cents, or 1.6 percent, to $16.40 at 12:45 p.m. in New York Stock Exchange composite trading. New Braunfels, Texas-based Rush gained 14 cents to $18.37 in Nasdaq Stock Market composite trading.
Industrywide light-vehicle sales ran at a 12.3 million annual pace in November, matching the October rate that was the fastest this year, researcher Autodata Corp. said yesterday.
“We don’t see any reason to believe that we shouldn’t continue to see slow improvement moving forward,” Monaghan said.