US auto giant sweeps up MAN bus distributor


US-based automotive dealership group Penske Automotive Group has signed an agreement to acquire the Commercial Vehicles Group (CVG) from Transpacific Industries Group for a purchase price of $219 million

July 31, 2013

US-based automotive dealership group Penske Automotive Group has signed an agreement to acquire the Commercial Vehicles Group (CVG) from Transpacific Industries Group for a purchase price of $219 million.

Headquartered in Brisbane, CVG is the exclusive importer and distributor of MAN buses and trucks, Western Star trucks and Dennis Eagle trucks for Australia and New Zealand.

The ASX-listed company has a network of 65 dealers across Australia and 16 dealers across New Zealand, and provides authorised parts, service and warranty functions for the three brands. The group also has dealer representation in Papua New Guinea, Philippines and Indonesia.

Penske Automotive, headquartered in Bloomfield Hills, Michigan, operates 332 retail automotive franchises, representing 39 different brands and 30 collision repair centres. It sells new and used vehicles, finance and insurance products and replacement parts, and offers maintenance and repair services on all brands it represents.

In 2012, it retailed and wholesaled more than 402,000 vehicles, with 64 percent of revenues generated in the US and Puerto Rico and 36 percent generated outside the US.

Premium brands, such as Audi, BMW, Mercedes-Benz and Porsche, represented 70 percent of retail revenue in 2012.

Penske Automotive is the second-largest automotive retailer in the US, as measured by the US$13.2 billion in revenue generated in 2012. It employs approximately 16,700 staff.

The US company has a wide and varied experience with commercial vehicles through its interest in Penske Truck Leasing, a leading provider of transportation and supply chain management services. Penske Truck Leasing operates and maintains more than 200,000 vehicles and services customers in North America, South America, Europe and Asia and is one of the largest purchasers of commercial trucks in North America.

Penske Automotive generally seek to acquire businesses with high-growth automotive brands in highly-concentrated or growing demographic areas that will benefit from the groups management expertise, manufacturer relations and scale of operations.

The acquisition of CVG provides it with its first business venture into Australia.

Chairman Roger Penske says the deal fits with this model.

CVG Managing Director Paul Glavac says it now has an owner totally focused on commercial vehicles, and access to additional professional business practices and automotive experience which will provide for enhanced customer service and a broader platform for growth.

Transpacific is Australia and New Zealand’s leading recycling, waste management and industrial services company.

"We are excited about our prospects and look forward to continue to work with our existing dealers and customer," he says.

"Our relationship with Transpacific will remain strong, and we will continue to provide quality products and customer service to this industry leading company."

The completion of the transaction is subject to normal closing conditions and is expected to occur by the end of the third quarter 2013.

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