Warren Buffett the car buff? Billionaire buys Van Tuyl Group.(+video)
Warren Buffett's Berkshire Hathaway is buying the privately-owned auto dealership company Van Tuyl Group as the billionaire looks to make inroads into the auto industry. If completed, the deal would give Warren Buffett control of the largest privately owned auto dealership group in the US.
Robin Buckson/Detroit News/AP/File
Warren Buffett's Berkshire Hathaway is buying the privately-owned auto dealership company Van Tuyl Group.
Financial terms were not disclosed.
Van Tuyl Group says it is the biggest privately owned auto dealership group in the U.S. It has 78 independently operated dealerships and more than 100 franchises in 10 states. The company will be renamed Berkshire Hathaway Automotive and be based in Dallas.
Current CEO Larry Van Tuyl will become chairman of the auto unit. Cecil Van Tuyl, Larry's father, started with a Kansas City Chevrolet dealership in 1955. He was joined in the family business by Larry in 1971, according to the company's website.
"After becoming a part of the Berkshire Hathaway family of businesses, the company will be known as Berkshire Hathaway Automotive. Berkshire Hathaway Automotive will continue to be led by Larry Van Tuyl, who will become Chairman, and Jeff Rachor, who will assume the role of Chief Executive Officer, as well as its experienced senior management team, a press announcemnt of the deal reads. "Berkshire Hathaway Automotive will be headquartered in Dallas, Texas and will continue to pursue its strategy of operational excellence and disciplined acquisition growth, which is no change to the business model the company has pursued for the last 62 years."
“The Van Tuyl Group fits perfectly into Berkshire Hathaway from both a financial and cultural viewpoint. Larry Van Tuyl along with his father, Cecil, spent decades building outstanding dealerships operated by local partners. In recent years, he has shared management with Jeff Rachor, a seasoned auto retailer who will retain a financial interest in all dealerships. The Van Tuyl Group enjoys excellent relations with the major auto manufacturers and delivers unusually high volumes at its 78 locations. This is just the beginning for Berkshire Hathaway Automotive,” Mr. Buffett said in a statement.
“We are proud of all that has been accomplished with the support of our dealer partners, our employees and the manufacturers that we represent. We are very pleased to have one of the world’s most respected companies, Berkshire Hathaway, assume ownership of our company with the commitment to preserving our unique culture, business model and philosophy,” said Larry Van Tuyl, current Chief Executive Officer of the Van Tuyl Group, in the press announcement. “I cannot think of a better steward to continue the legacy of what my father and I have built over the last 62 years, and I am confident this transaction will position the company on a course of continued success.”
The deal is expected to close in 2015's first quarter. It still needs approval from major auto manufacturers.