US automotive giant Penske to buy Western Star Trucks Australia

US company Penske Automotive signed a deal to buy the Commercial Vehicles Group (CVG) from Australian-based Transpacific Industries Group for a purchase price of $219 million.

CVG is the exclusive importer and distributor of Western Star trucks, MAN trucks, MAN buses and Dennis Eagle trucks for Australia and New Zealand. It can boast a network of 65 dealers across Australia and 16 dealers across New Zealand, as well as dealer representation in Papua New Guinea, Philippines and Indonesia.

Headquartered outside Detroit, Michigan, Penske is the second largest automotive retail business in the United States and generated US$13.2 billion in total revenue in 2012.

The acquisition of CVG provides Penske with its first business venture into Australia. According to an official statement, the US automotive giant seeks to acquire, “businesses with high-growth brands in highly concentrated or growing demographic areas that will benefit from the group’s management expertise, manufacturer relations and scale of operations.”

“Our business success is driven by our core values – the importance of human capital, maintaining OEM relationships, our commitment to a premium brand mix, diversification, capital investment and fostering repeat and referral business through a commitment to customer satisfaction and exceeding expectations,” said Roger S. Penske, Chairman of Penske Automotive Group.

“The acquisition of the Commercial Vehicles Group of Transpacific fits with this model, and we are excited to enter the Australian market.”

CVG Managing Director Paul Glavac commented: “We are very eager to move forward as part of Penske Automotive Group – we now have a total company focus on commercial vehicles, and access to additional professional business practices and automotive experience, which will provide for enhanced customer service and a broader platform for growth for us and our dealers.

He added, “We are excited about our prospects and look forward to continue to work with our existing dealers and customers. Our relationship with Transpacific will remain strong, and we will continue to provide quality products and customer service to this industry leading company.”

Background:

Penske Automotive currently operates 332 retail automotive franchises in North America, representing 39 different brands, including Audi, BMW, Mercedes-Benz and Porsche.  It retailed and wholesaled more than 402,000 vehicles in 2012.

Wholly owned subsidiary Penske Truck Leasing operates and maintains more than 200,000 vehicles and services customers in North America, South America, Europe and Asia and is one of the largest purchasers of commercial trucks in North America.

The completion of the transaction is subject to normal closing conditions and is expected to occur by the end of the third quarter 2013.

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