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Note 14 - Acquisitions
 12 Months Ended
Dec. 31, 2013
Business Combinations [Abstract]  
Business Combination Disclosure [Text Block]

(14)        Acquisitions


In 2013, we completed the following acquisitions, which contributed revenues of $64.7 million for the year ended December 31, 2013:


 

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On June 10, 2013, we acquired OB Salem Auto Group, Inc. in Salem, Oregon, including BMW, Honda and Volkswagen franchises.


 

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On October 7, 2013, we acquired Stockton Nissan Kia in Stockton, California.


 

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On October 24, 2013, we acquired Fresno Lincoln Volvo in Fresno, California.


 

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On November 1, 2013, we acquired Howard’s Body Shop in Klamath Falls, Oregon.


 

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On November 4, 2013, we acquired Geweke Motors, Inc. a Toyota Scion store in Lodi, California.


 

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On December 2, 2013, we acquired Diablo Subaru in Walnut Creek, California.


We completed the following acquisitions in 2012:


 

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On April 30, 2012, we acquired Bellingham Chevrolet and Cadillac in Bellingham, Washington.


 

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On June 12, 2012, we acquired Fairbanks GMC Buick in Fairbanks, Alaska.


 

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On August 27, 2012, we acquired Killeen Chevrolet in Killeen, Texas.


 

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On October 23, 2012, we acquired Bitterroot Toyota in Missoula, Montana.


We completed the following acquisitions in 2011:


 

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On April 18, 2011, we acquired Mercedes-Benz of Portland, Oregon, Mercedes Benz of Wilsonville, Oregon and Rasmussen BMW/MINI in Portland, Oregon.


 

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On October 7, 2011, we acquired Fresno Subaru in Fresno, California.


All acquisitions were accounted for as business combinations under the acquisition method of accounting. The results of operations of the acquired stores are included in our Consolidated Financial Statements from the date of acquisition


No portion of the purchase price was paid with our equity securities. The following table summarizes the consideration paid for material acquisitions and the amount of identified assets acquired and liabilities assumed as of the acquisition date (in thousands):


Consideration paid for year ended December 31,

 

2013

   

2012

 

Cash paid, net of cash acquired

  $ 81,105     $ 44,716  

Assets acquired and liabilities assumed for year ended December 31,

 

2013

   

2012

 

Inventories

  $ 30,624     $ 17,541  

Franchise value

    8,770       5,174  

Property, plant and equipment

    24,741       11,097  

Real estate lease reserves

    (221 )     -  

Other assets

    264       110  

Reserves

    (344 )     -  

Capital lease obligations

    (37 )     (2,609 )

Other liabilities

    (156 )     (307 )
      63,641       31,006  

Goodwill

    17,464       13,710  
    $ 81,105     $ 44,716  

We account for franchise value as an indefinite-lived intangible asset. We expect the full amount of the goodwill recognized to be deductible for tax purposes. We did not have any material acquisition-related expenses in 2013, 2012 or 2011.


The following unaudited pro forma summary presents consolidated information as if the 2013 and 2012 acquisitions had occurred on January 1 of the prior year (in thousands, except for per share amounts):


Year Ended December 31,

 

2013

   

2012

   

2011

 

Revenue

  $ 4,144,945     $ 3,571,853     $ 2,789,436  

Income from continuing operations, net of tax

    105,783       81,531       56,904  

Basic income per share from continuing operations, net of tax

    4.10       3.17       2.17  

Diluted income per share from continuing operations, net of tax

    4.04       3.12       2.13  

These amounts have been calculated by applying our accounting policies and estimates. The results of the acquired stores have been adjusted to reflect the following: depreciation on a straight-line basis over the expected lives for property, plant and equipment; accounting for inventory on a specific identification method; and recognition of interest expense for real estate financing related to stores where we purchased the facility. No nonrecurring pro forma adjustments directly attributable to the acquisitions are included in the reported pro forma revenues and earnings.


In July 2011, we were awarded a Ford franchise in Klamath Falls, Oregon which was accounted for as an asset acquisition. Consideration of $5.1 million was paid for the inventory, equipment and associated real estate.