Asbury Automotive Group, Inc., one of the largest automotive retail and service companies in the U.S., signed a definitive agreement to acquire Jim Koons Automotive Companies, the ninth largest privately-owned dealership group in the country.
The sale of the Mid-Atlantic company is one of the most sizable in auto retail history, representing more than $3 billion in revenue in 2022, and includes 20 dealerships, 29 franchises, six collision centers and one of the highest volume Toyota and Stellantis dealerships in the U.S. Asbury currently operates 138 dealerships, representing 31 domestic and foreign brands, as well as 32 collision repair centers.
Kerrigan Advisors was the exclusive sell-side advisor on the transaction, representing Koons. The transaction is subject to customary closing conditions and is expected to close in the fourth quarter of 2023 or early in the first quarter of 2024. Asbury plans to fund the purchase price with its existing liquidity, credit facility and cash on hand.
Fifty years ago, Jim Koons took over the operation of his father’s dealership, Koons Ford in Falls Church, VA, founded in 1964. He achieved steady growth over the years due to a deep work ethic and a constant focus on his employees, customers and the community.
“My parents, John and Eleanor Koons, instilled these values from our company’s beginning. I am grateful to every one of our customers and employees for their contribution to our success,” said Jim Koons, chairman of Jim Koons Automotive Companies. “At Koons, it has always been all about people, and we deeply appreciate Asbury’s commitment to continuing this tradition. Our work with David Hult, and the Asbury team, gives us confidence that not only are our customers in excellent hands, but so are our employees, with opportunities for future growth being a part of Asbury.”
Founded in 1973, Jim Koons Automotive Companies was one of only 13 private groups with more than $3 billion in revenue in 2022. The group, comprised of top volume franchises including Toyota, Lexus, Mercedes-Benz, Ford, Kia, Hyundai, Volvo, Stellantis and General Motors, is the dominant retailer in the thriving Washington-Baltimore market, the fourth largest CSA in the U.S. by population per 2020 census data. Revenue per dealership for Koons ranked 10th overall in 2022, and fifth in the U.S. for groups with greater than $2 billion in revenue.
“This acquisition is transformative for our company, enabling Asbury to further expand into one of the country’s top economies in one of its fastest growing regions, with some of the U.S.’s best performing dealerships,” said David Hult, Asbury's president and CEO. “Koons has an impressive history of achievement in sales, CSI and revenue across its 20 dealerships, and is legendary for its emphasis on people---employees and community---and for giving back. These are values that we at Asbury share, along with the disciplined work ethic that has enabled Koons to achieve so much success. We are proud to continue what Jim Koons and his exceptional management team expanded upon: an unwavering dedication to excellence in automotive retailing. We expect the Koons dealerships’ profitability to be generally in line with the profitability of Asbury’s dealerships.”
Among its many accolades, Koons is the only dealership group in the region to be recognized multiple times by the Washington Post and Washington Business Journal as a top place to work. Koons dealerships are well-regarded by automakers, consistently earning high customer satisfaction scores and sales volumes and earning multiple awards, including Toyota President’s Cabinets Award, Elite of Lexus, Ford’s President’s Award, Toyota’s Board of Governors, Ford’s Triple Crown Award and Mercedes’ Best of the Best. Jim Koons is in the Ford Hall of Fame and received an honorary doctorate from his alma mater, Northwood University.
Jim Koons and his wife, Cece, are longtime philanthropists, having donated to Bishop O’Connell High School in Arlington, VA, Northwood University, Catholic Charities and The Talbot Hospice Foundation.
“We were truly honored to represent Jim Koons Automotive Companies, one of the most respected private dealership groups in the U.S., and to have the opportunity to work with Mr. Koons on the sale,” said Erin Kerrigan, founder and managing director of Kerrigan Advisors. “This milestone transaction, the largest since 2021, reflects the strength of the U.S. auto retail market in 2023, as well as the importance of family legacy and reputation to acquiring groups. In Koons, Asbury is adding a 59-year-old business and the top auto retail brand in the Washington-Baltimore market---one of the most economically vibrant regions in our country.”
Kerrigan noted the dynamism of the Washington-Baltimore area: it is the fourth largest market in the U.S. with nearly 10 million residents, holds five of the top eight highest income earning counties based on U.S. census surveys from 2017-2021, and is home to multiple Fortune 500 companies, the federal government and a flourishing tech sector.
Stephen Dietrich and Brooke Sizer of Holland & Knight served as legal counsel and Baker Tilly served as the transaction accounting firm to Koons. Jones Day and Hill Ward Henderson served as legal counsel and FORVIS served as the transaction advisory firm to Asbury.
Source: Asbury Automotive
Abby Andrews