LMP Automotive Holdings, Inc. Revises Atlantic Automotive Groups Acquisition Agreements to a Combination of Cash and LMPX Sto...
January 13 2021 - 7:00AM
LMP Automotive Holdings, Inc. (NASDAQ: LMPX) (the "Company" or
“LMP”), an e-commerce and facilities-based platform for consumers
who desire to buy, sell, subscribe to or finance pre-owned and new
automobiles, today announced it has revised its agreements to
acquire Atlantic Automotive Group (“AAG”) to a combination of cash
and LMPX common stock and to exclude certain dealerships owned by
AAG in a deal valued at $330 million.
- Acquisition agreements
include revised transaction terms from the transaction previously
announced on October 9, 2020
- Includes Atlantic Central
Storage, eight dealership locations consisting of nine import and
domestic franchise brands along with several management companies
that generated approximately $655 million revenue and $25.1 million
in net income in calendar year 2020
- Real estate leased with an
option to purchase owned properties
- LMP’s 70% partnership
interest purchase is comprised of $40 million in LMPX common stock
with a floor of $57 per share and $191 million in
cash
- Acquisition is inclusive of
approximately $34.7 million of working capital and FF&E and is
expected to be immediately accretive to cash flow and earnings upon
close, adding $15 million in annualized net income or $1.35 per
share in 2021 and 16.9 million in net income or $1.52 per share in
full year 2022 based on an estimated 11.1 million shares to be
outstanding after closing. We expect to close the transaction in
April of this year
- Adds approximately 610
employees to LMP’s partnership portfolio companies
- Atlantic Automotive Group’s
ownership and management will continue to operate the business
post-closing
- Upon closing and combined
with our previously contracted stage 1 acquisitions which are
expected to close this month, LMP’s revenues are expected to exceed
$1.3 billion, with approximately $36 million in net income or $3.24
per share in 2021 on an annualized basis and $1.4 billion, with
approximately $39 million in net income or $3.51 per share in 2022
inclusive of synergies and adds over 1,100 employees in our
partnership portfolio companies
Sam Tawfik, LMP’s Chief Executive Officer
stated, “On behalf of myself, LMP and our Board of
Directors, I want to welcome and thank the Atlantic team on our
prospective partnership. Atlantic has been recognized in the past
as a top 8 dealership group in the U.S. as measured by revenue and
is a leader in automotive retail. We are all looking forward to
working together and expanding upon Atlantic’s previous success. We
expect to close our previously-announced stage 1 acquisitions this
month, and the Atlantic acquisition by April, subject to customary
closing conditions and manufacturer approval.”
Richard Aldahan, LMP’s Chief Operating Officer
added, “This restructured partnership combined with our
stage 1 deals in contract brings our total contracted new vehicle
franchise count to 21, operating at 15 locations, and our pre-owned
dealership count to 5 locations with vehicle unit sales of roughly
39,500 in 2020 with a 52% new to used mix along with additional
vehicle storage capacity of over 5,000 vehicles between the
Northeast and Southeastern United States. This is an important
addition to our network given Atlantic’s dominant and clustered
presence in New York, one of the most lucrative markets in the
United States. Atlantic’s vehicle fulfillment, reconditioning and
service capacity will cost-effectively expand our free delivery
radius and cut out multiple legs of costly transportation,
logistics and reconditioning costs. We look forward to working with
our future teammates at Atlantic,” Mr. Aldahan concluded.
Evan Bernstein, LMP’s Chief Financial Officer
commented, " The Atlantic partnership is expected to add
an estimated $655 million in revenue, $15 million in net income on
an annualized basis in 2021 or $1.35 per share and 16.9 million in
net income or $1.52 per share in full year 2022 inclusive of
synergies and based on an estimated 11.1 million shares to be
outstanding after closing. Under our previously signed agreement
with a purchase price of $397.6 million for LMP’s 70% partnership
interest which we terminated, we had expected to be accretive to
earnings in an amount equal to $3.18 per share and net income of
$38 million on an annualized basis. With Atlantic’s newly
structured deal, combined with our currently contracted
acquisitions which we expect to close this month, we anticipate
combined expected revenues to exceed $1.3 billion, with
approximately $36 million in net income or $3.24 per share in 2021
on an annualized basis and $1.4 billion, with approximately $39
million in net income or $3.51 per share in 2022 inclusive of
synergies.” Mr. Bernstein added, “We are seeing a robust
acquisition market as we continue to build our pipeline of
prospective dealership partnerships and intend on accelerating our
acquisition strategy moving forward in our targeted regions, as
well as recruiting additional management and promoting within our
portfolio companies.” Mr. Bernstein concluded.
CONFERENCE CALL
Management will host an investor conference call
at 10:00 a.m. ET on Wednesday, January 13, 2021 to discuss the
Company’s recently announced acquisition and conclude with Q&A
from participants.All interested parties can join the call by
dialing (877) 407-3982 or (201) 493-6780. A webcast of the call may
be accessed
at: http://public.viavid.com/index.php?id=143027.
An archived webcast of the conference call will
be accessible from the Investor Relations section of the company's
website, https://investors.lmpah.com/.
A telephonic replay of the conference call will be available
through Wednesday, January 27, 2021 by dialing (844) 512-2921 or
(412) 317-6671 and entering passcode 13715029.
ABOUT LMP AUTOMOTIVE HOLDINGS, INC. –
“BUY, SUBSCRIBE, SELL AND REPEAT.”LMP Automotive Holdings,
Inc. (NASDAQ: LMPX) describes its business model as “Buy,
Subscribe, Sell and Repeat.” This means that we “Buy” pre-owned
automobiles primarily through auctions or directly from other
automobile dealers, and new automobiles from manufacturers and
manufacturer distributors. We “Subscribe” the automobiles to our
customers by allowing them to enter into our subscription plan for
automobiles in which customers have use of an automobile for a
minimum of thirty (30) days. LMP’s vehicle subscription membership
includes monthly swaps and offers the flexibility to return the
vehicle without penalty, upgrade your vehicle to a more premium
model or downgrade for a lesser cost model when you like. We “Sell”
our inventory, including automobiles previously included in our
subscription programs, to customers as well, and then we “Repeat”
the whole process.
Investor Relations:LMP Automotive Holdings,
Inc.500 East Broward Boulevard, Suite 1900Fort Lauderdale, FL
33394investors@lmpah.com
For more information visit: https://lmpmotors.com/.
FORWARD-LOOKING STATEMENTS:This press release
may contain “forward-looking statements” within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, each as amended. Such statements
include, but are not limited to, any statements relating to our
expectations, beliefs, projections, future plans and strategies,
anticipated events or trends and similar matters that are not
historical facts. These statements may be preceded by, followed by
or include the words “aim,” “anticipate,” “believe,” “estimate,”
“expect,” “forecast,” “intend,” “likely,” “outlook,” “plan,”
“potential,” “project,” “projection,” “seek,” “can,” “could,”
“may,” “should,” “would,” will,” the negatives thereof and other
words and terms of similar meanings. Forward-looking statements are
based on management’s current expectations and are subject to risks
and uncertainties that could negatively affect our business,
operating results, financial condition, and stock value. Factors
that could cause actual results to differ materially from those
currently anticipated include: our dependence upon external sources
for the financing of our operations; our ability to effectively
executive our business plan; our ability to maintain and grow our
reputation and to achieve and maintain the market acceptance of our
services and platform; our ability to manage the growth of our
operations over time; our ability to maintain adequate protection
of our intellectual property and to avoid violation of the
intellectual property rights of others; our ability to maintain
relationships with existing customers and automobile suppliers, and
develop relationships; and our ability to compete and succeed in a
highly competitive and evolving industry; as well as other risks
described in our SEC filings. There is no assurance that any
forward-looking statements will materialize. You are cautioned not
to place undue reliance on forward-looking statements, which
reflect expectations only as of this date. We expressly disclaim
any obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to
reflect any change in our expectations or any changes in events,
conditions, or circumstances on which any such statement is based,
except as required by law.
SOURCE: LMP Automotive Holdings,
Inc.
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