SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 4, 1999
Lithia Motors, Inc.
(Exact Name of Registrant as Specified in its Charter)
Oregon 0-21789 93-0572810
- -------------------------------------------------------------------------------
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.
of incorporation)
360 E. Jackson St., Medford, Oregon 97501
- -------------------------------------------------------------------------------
Address of Principal Executive Office Zip Code
Registrant's telephone number including area code 541-776-6899
Former name or former address, if changed since last report) Not applicable
1
<PAGE>
Item 5. Other Events.
Lithia announced that it has entered into an agreement with the
Moreland Auto Group to acquire six automobile dealerships in Colorado and one
in Nevada. See the attached News Release for details.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of Business Acquired.
None
(b) Pro Forma Financial Information.
None
(c) Exhibits
99 Lithia Motors, Inc. Press Release
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LITHIA MOTORS, INC.
(Registrant)
Date: March 4, 1999 By: /s/ Brian R. Neill
---------------------------------------
Brian R. Neill
Chief Financial Officer
2
<PAGE>
Exhibit Index
Exhibit
99 Press Release dated March 4, 1999
LITHIA MOTORS, INC. For additional information contact:
360 E. Jackson Street Jeff DeBoer, VP - Finance/Investor Relations
Medford, Oregon 97501 (541) 776-6868
LITHIA MOTORS, INC. ADDS NEW CHRYSLER PLATFORM WHICH WILL INCREASE REVENUE
RUN RATE TO OVER $1.2 BILLION
MEDFORD, OREGON, MARCH 4, 1999 - Lithia Motors, Inc. (NYSE: LAD) today
announced that it has entered into definitive agreements to add a seven
dealership platform in four rapidly growing markets in Colorado and Nevada
which form the Moreland Automotive Group. The dealerships are Cherry Creek
Dodge, Centennial Chrysler/Plymouth/Jeep, Colorado Chrysler/Plymouth,
Colorado Jeep/Kia, Colorado Springs Chrysler/Plymouth/Jeep, Foothills Auto
Plaza (Dodge/Chrysler/Plymouth/Jeep/Hyundai/Suzuki) and Reno Auto Sales. The
six Colorado dealerships sell Chrysler products, Lithia's historically best
performing franchises, and represent three new markets and form the base for
a new platform in the Inter-Mountain States. This Chrysler dominance in
Colorado extends from Fort Collins to Southern Colorado, including Colorado
Springs. The seventh dealership has Subaru and Hyundai franchises and is a
"fill-in" in the Reno, Nevada market where Lithia currently has three
dealerships. These dealerships sold over 18,000 new and used vehicles and
have combined 1998 revenues of $390 million. Upon completion of this
transaction which will be accounted for as a purchase, Lithia Motors will
have an annualized revenues of over $1.2 billion.
Lithia's initial net investment in the stores will total approximately $50
million and will be paid in a combination of Class A Common Stock and a new
series of Preferred Stock redeemable at the option of the company. The
balance will be paid in cash with borrowing from the company's used vehicle
flooring line. The $75 million acquisition credit facility with Ford Motor
Credit will not need to be utilized in this transaction. Doug Moreland will
join the Lithia Board, and key executives will execute long-term employment
contracts and operate the new platform group. The transaction is subject to
customary closing requirements, including obtaining approval from the
manufacturers. Lithia expects the transaction to be completed during the
second quarter of 1999.
Sidney B. DeBoer, Chairman and CEO, stated, " We are pleased to have Doug
Moreland and his organization join the Lithia Group. It took a great deal of
diligence to find the platform group that had the right fit for us in terms
of people, operations, and franchises. The Moreland Group is the largest
Chrysler/Dodge/Jeep dealer group in the State of Colorado and one of the
largest privately held Chrysler product groups in the country. Doug Moreland
is a veteran auto retailer whose focus on customer service and vision of the
automotive industry are closely aligned with those of Lithia's management."
Dick Heimann, President and COO of Lithia Motors, previously made his home in
Colorado where he began his automotive career with Chrysler, and has stayed
in close touch with the great Rocky Mountain Market. Mr. Heimann stated,
"The combination of Chrysler, Lithia and Moreland in the Colorado market
represents an unprecedented winning opportunity for growth. The Moreland
dealerships provide Lithia with a dominant market position with Chrysler
products in a market with strong population growth and high demand for trucks
and sport utility vehicles. More importantly, with the new platform, we can
pursue "fill-in" acquisitions in the surrounding markets which will further
improve our return on investment."
Doug Moreland, President of the Moreland Group, stated, "I chose to invest in
Lithia because of their intense operational focus of selling cars and making
customers happy. Lithia's management team has the same strong Chrysler
background as myself and my management staff. This is a natural fit in terms
of communication and strategic objectives. We are excited about being a part
of the best public automobile dealership group in the country."
Doug Moreland's 30 years of experience in the automotive business has earned
him many honors, including: Charger/Pacesetter/Eagle Club (over 20 times);
multiple five star Chrysler dealer awards; Subaru top 20 dealer and Subaru
Chairman Roundtable Dealer the last three years; Chrysler/Plymouth National
Dealer Council; Dodge National Dealer Council; Current Vice President and
President Elect Colorado Automobile Dealer Association; President Front Range
Chrysler/Plymouth Advertising Association; and Executive Committee of
Chrysler Dealer Advertising Association.
Upon completion, Lithia will operate 35 dealerships in 14 markets located in
California, Oregon, Washington, Nevada and Colorado. The company will sell
24 brands of new vehicles through 77 franchises. Lithia also sells used
vehicles, arranges finance, warranty, and credit insurance contracts,
provides vehicle parts, maintenance, and repair services at all of its
locations. The company will operate 6 collision repair centers.
This press release includes forward looking statements which management
believes are a benefit to shareholders. These statements are necessarily
subject to risk and uncertainty and actual results could differ materially
due to certain risk factors, including without limitation, economic
conditions, acquisition risk factors, manufacturer approval, and others set
forth from time to time in the company's filing with the SEC.
