They pay 7.5X...You pay 22.5X...
Globe says AutoCanada upbeat about oil-patch layoffs
2015-02-20 08:44 ET - In the News
The Globe and Mail reports in its Friday edition the oil-price shock battering the Alberta economy could lead to more buying opportunities for AutoCanada, the company claims. The Globe's Greg Keenan writes good car dealerships are likely to be available at last year's prices, said Pat Priestner, executive chairman of the compan. "If there were 10 dealerships to look at last year, midway through this year there might be 15 easily to look at," Mr. Priestner said. "We don't think they're going to be a major bargain price ... but they're certainly not going up." AutoCanada does not reveal what it pays to acquire dealerships, but a regulatory filing made last year showed it paid $96.5-million to buy a six-dealership group in Calgary and the right to open a new Nissan dealer in the city. That was 7.5 times the $12.8-million in final profit reported by Hyatt Auto Group in 2013. Vehicle sales are expected to take a hit in Alberta and Saskatchewan as Canada's energy giants scale back capital spending and lay off employees in response to the collapse in oil prices since last June. Cenovus, Husky and Precision Drilling are among the companies that have announced layoffs and cuts in capital spending.