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Automotive retailer AP Eagers Limited (ASX:APE) has bought a 16.33 per cent stake in listed automotive retailing and logistics group, Automotive Holdings Group Limited (ASX:AHE).
Making the announcement after the market closed yesterday AP Eagers said it had purchased the interest from Automotive Holdings' founding shareholders, the Wheatley Family.
AP Eagers will pay $41.4 million in cash and issue 10.19 million shares to the Wheatley Family and also pay an extra $47 million cash by July 2013.
The transaction will give the Wheatley Family a 6.1 per cent interest in AP Eagers, making them the company’s third largest shareholder.
AP Eagers believes the Automotive Holdings Group investment will give it entrance and exposure into the West Australian market in addition to the purchase becoming immediately earnings accretive.
In the full 2011 calendar year AP Eagers boosted its net profit by 28 per cent to $40.3 million.
