Company Allowed Direct Ownership and Control of GM Canada Dealerships, Assumes Control of Five Stores
EDMONTON, Dec. 7, 2017 /CNW/ - AutoCanada Inc. (TSX: ACQ) (or the "Company") today announced two new agreements that will strengthen its relationship with GM Canada. The Company has executed a Public Company Master Agreement (PCMA) with GM Canada that permits AutoCanada's direct ownership and control of GM Canada dealerships. It has also reached an agreement with CanadaOne Auto Group, a company controlled by the Company's former CEO and founder, Mr. Patrick Priestner, that will see AutoCanada assume control of five of the nine GM Canada dealerships where it held a majority equity stake with no voting rights, and CanadaOne Auto Group buying AutoCanada's interest in four dealerships.
Under the newly negotiated agreements, five dealerships will become majority owned and controlled by AutoCanada and the remaining four by CanadaOne Auto Group (ownership by entity post-closing is presented below). Under the terms of the PCMA, each General Manager in an AutoCanada/GM Canada dealership will be required to own a minority equity position in their dealership.
CanadaOne Auto Group Dealerships
Island Chevrolet Buick GMC, Duncan, BC
Kelowna Chevrolet, Kelowna, BC
Bridges Chevrolet Buick GMC, North Battleford, SK
Lakewood Chevrolet, Edmonton, AB
Mann-Northway Auto Source, Prince Albert, SK
Sherwood Park Chevrolet, Sherwood Park, AB
Saskatoon Motor Products, Saskatoon, SK
Sherwood Park Buick GMC, Sherwood Park, AB
McNaught Cadillac Buick GMC, Winnipeg, MB
AutoCanada will receive a one-time net payment of approximately $23 million from CanadaOne Auto Group as part of the transaction. The transaction was reviewed and approved by an independent committee of the Board of Directors of the Company and is expected to close on January 2, 2018, subject to GM Canada's final approval of the transactions.
FORWARD LOOKING STATEMENTS
Certain statements contained in this news release are forward‑looking statements and information (collectively "forward‑looking statements"), within the meaning of the applicable Canadian securities legislation. We hereby provide cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in these forward‑looking statements. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words or phrases such as "will likely result", "are expected to", "will continue", "is anticipated", "projection", "vision", "goals", "objective", "target", "schedules", "outlook", "anticipate", "expect", "estimate", "could", "should", "plan", "seek", "may", "intend", "likely", "will", "believe" and similar expressions are not historical facts and are forward‑looking and may involve estimates and assumptions and are subject to risks, uncertainties and other factors some of which are beyond our control and difficult to predict. Accordingly, these factors could cause actual results or outcomes to differ materially from those expressed in the forward‑looking statements. Therefore, any such forward‑looking statements are qualified in their entirety by reference to the factors discussed throughout this document.
Further, any forward‑looking statement speaks only as of the date on which such statement is made, and, except as required by applicable law, we undertake no obligation to update any forward‑looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward‑looking statement.
SOURCE AutoCanada Inc.
For further information: Christopher Burrows, Senior Vice-President & Chief Financial Officer, Phone: 780.509.2808, Email: [email protected]