Warren Buffet’s multinational conglomerate, Berkshire Hathaway, is entering the automobile sales business by acquiring the car dealership company Van Tuyl Group.
Van Tuyl Group is America’s largest privately owned auto dealership company, operating 78 dealerships, with over 100 franchises across 10 states.
Following the acquisition, which is expected to be completed in the first quarter of 2015, Van Tuyl Group will become Berkshire Hathaway Automotive and will be based in Dallas, Texas.
It is only the third time that Berkshire Hathaway will rebrand one of its acquisitions with “Berkshire” added to its name, with the company recently renaming it’s utility division into Berkshire Hathaway Energy.
Buffet has said that there is an opportunity to consolidate the market in the auto dealership business in the US.
The current CEO of Van Tuyl Group, Larry Van Tuyl, will assume the role of chairman in the new unit, and the role of CEO will be given to Jeff Rachor.
Berkshire Hathaway’s Chairman and Chief Executive Officer, Warren Buffett, said:
”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,”
Larry Van Tuyl said:
“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,”
He added:
“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.”
