XML 30 R13.htm IDEA: XBRL DOCUMENT
v3.25.1

ACQUISITIONS AND DISPOSITIONS | 3 Months Ended
--- | ---
Mar. 31, 2025
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] |
ACQUISITIONS AND DISPOSITIONS | ACQUISITIONS AND DISPOSITIONS The Company accounts for business combinations under the acquisition method of accounting, under which the Company allocates the purchase price to the assets acquired and liabilities assumed based on an estimate of fair value. Inchcape Acquisition On August 1, 2024, the Company completed the acquisition of Inchcape Retail automotive operations (“Inchcape Retail”), consisting of 54 dealership locations, certain real estate and three collision centers acro ss the U.K. (collectively referred to as the “Inchcape Acquisition”), for aggregate consideration of approximately $517.0 million. The purchase price allocation for the Inchcape Acquisition is preliminary. The Company is continuing to analyze and assess relevant information related to the valuation of certain property, equipment, intangible assets, property lease contracts and deferred income taxes. Due to the recent timing and complexity of the Inchcape Acquisition, these amounts are provisional and subject to change as the Company’s fair value assessments are finalized. The Company will reflect any such adjustments in subsequent filings. The results of the Inchcape Acquisition are included in the U.K. segment. The acquired goodwill is not deductible for income tax purposes. The following table summarizes the consideration paid and aggregate amounts of assets acquired and liabilities assumed as of March 31, 2025 (in millions):
Total consideration |  | $ | 517.0 |
Identifiable assets acquired and liabilities assumed |  |
Cash |  | $ | 23.4 |
Contracts-in-transit and vehicle receivables, net |  | 27.6 |
Accounts receivable, net |  | 37.7 |
Inventories |  | 384.3 |
Prepaid expenses and other current assets |  | 14.1 |
Property and equipment |  | 282.2 |
Operating lease assets |  | 104.3 |
Intangible franchise rights |  | 123.7 |
Total assets acquired |  | 997.3 |
Floorplan notes payable |  | 236.4 |
Accounts payable |  | 204.6 |
Accrued expenses |  | 54.0 |
Operating lease liabilities |  | 75.4 |
Deferred income taxes |  | 27.6 |
Other liabilities |  | 3.9 |
Total liabilities assumed |  | 602.0 |
Total identifiable net assets |  | 395.3 |
Goodwill |  | $ | 121.7 |
The Company recorded $0.2 million of acquisition related costs attributable to the Inchcape Acquisition during the three months ended March 31, 2025. These costs are included in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations. The Company’s Condensed Consolidated Statements of Operations included revenues and net income attributable to Inchcape Retail for the three months ended March 31, 2025, of $655.9 million and $1.9 million, respectively. The following unaudited pro forma financial information presents consolidated information of the Company as if the Inchcape Acquisition had occurred on January 1, 2024 (in millions):
|  | Three Months Ended March 31, 2024
|  | (unaudited)
Revenues |  | $ | 5,155.6 |
Net income |  | $ | 145.5 |
This pro forma information incorporates the Company’s accounting policies and adjusts the results of Inchcape Retail assuming that the fair value adjustments in connection with the Inchcape Acquisition occurred on January 1, 2024. They have also been adjusted to reflect the $0.2 million and $15.4 million of acquisition-related costs incurred during the three months ended March 31, 2025 and the year ended December 31, 2024, respectively, as having occurred on January 1, 2024. Pro forma data may not be indicative of the results that would have been obtained had these events actually occurred at the beginning of the period presented and is not intended to be a projection of future results. Other Acquisitions During the three months ended March 31, 2025, the Company acquired four dealerships in the U.K, including three Toyota dealerships and one Lexus dealership. Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $16.4 million. Goodwill associated with the acquisitions totaled $2.4 million. The purchase price allocation for these acquisitions is preliminary and subject to change as the Company’s fair value assessments are finalized. The Company is continuing to analyze and assess relevant information related to the valuation of certain assets and liabilities, including, but not limited to, the valuation of property, equipment, intangible assets and deferred income taxes. The Company will reflect any required fair value adjustments in subsequent periods. During the three months ended March 31, 2024, the Company acquired nine dealerships in the U.S., including three Honda dealerships, two Lexus dealerships, one Toyota dealership, one Kia dealership, one Hyundai dealership and one Mercedes-Benz dealership. The Company also acquired one Toyota Certified pre-owned center and three collision centers in the U.S. Aggregate consideration paid for these dealerships, which were accounted for as business combinations, was $690.4 million. Goodwill associated with the acquisitions totaled $288.3 million. Dispositions The Company’s divestitures generally consist of dealership assets and related real estate. Gains and losses on divestitures are recorded in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations. During the three months ended March 31, 2025, the Company recorded a net pre-tax gain totaling $1.6 million related to the disposition of one dealership in the U.S. The disposition reduced goodwill by $4.6 million. The Company also terminated four franchises in the U.S. During the three months ended March 31, 2025, the Company closed two dealerships in the U.K. in connection with the Restructuring Plan (as defined in Note 4. Restructuring). Refer to Note 4. Restructuring for further discussion. During the three months ended March 31, 2025, the Company recorded an impairment charge of $2.7 million associated with the anticipated termination of certain franchises in the U.K in the second quarter of 2025. During the three months ended March 31, 2024, the Company recorded a net pre-tax gain totaling $30.9 million related to the disposition of six dealerships in the U.S. The dispositions reduced goodwill by $39.8 million. Assets held for sale in the Condensed Consolidated Balance Sheets includes $6.7 million and $11.5 million of goodwill that has been reclassified to assets held for sale as of March 31, 2025 and December 31, 2024, respectively. During the year ended December 31, 2024, the Company recognized $4.8 million in intangible asset impairment associated with assets held for sale. During the three months ended March 31, 2025, the Company recognized a gain of $2.3 million associated with these previously impaired assets held for sale.

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationAndAssetAcquisitionAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/205-20/tableOfContent + Details
Name: | us-gaap_MergersAcquisitionsAndDispositionsDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration