Overview
Franchise Equity Partners (FEP) acquired Hartz Automotive’s minority stakes in three Penske-operated dealerships in Southern California, closing on December 16. The transaction marks FEP’s first automotive investment in California. Financial terms were not disclosed.
Dealerships Involved
- Penske Buick-GMC of Cerritos (Cerritos)
- Penske Chevrolet of Cerritos (Cerritos)
- Penske Cadillac-Buick-GMC of South Bay (Torrance)
Advisors and Counsel
- Sell-side advisor: The Presidio Group (via Presidio Merchant Partners LLC)
- Seller’s legal counsel: Jeff Roberts, Underwood and Roberts
- Buyer’s legal counsel: Stephen Dietrich, Holland & Knight
Strategic Rationale
The deal broadens FEP’s geographic footprint beyond existing holdings in New York, Pennsylvania, the Carolinas, and Virginia. According to the announcement, it also expands FEP’s presence in Honda and Toyota retail networks, while reinforcing its strategy of making minority investments alongside established operators and providing permanent capital to support growth and simplify ownership structures.
Comments from the Parties
Daisy Hartz described the sale as a “bittersweet” but necessary step that honors her late husband’s legacy, crediting Presidio for navigating a complex, multi-stakeholder process. FEP’s Scott Romanoff emphasized the firm’s role in partnering with leading operators to streamline governance and position organizations for future growth. Presidio leaders highlighted rising activity in partial-interest transactions and the coordination required among buyers, sellers, manufacturers, and counsel.
Market Context
The transaction underscores the growing prevalence of minority-stake and partial-interest deals in auto retail, particularly in constrained markets like Southern California where preserving manufacturer relationships and local leadership is key. Presidio anticipates continued momentum in dealership M&A, with both full acquisitions and tailored partnerships.
Operations and Transition
The announcement did not outline operational changes or impacts on customers. In minority-stake transactions, existing management typically continues day-to-day operations with added capital support and a revised ownership structure.
About Presidio’s Platform
Presidio provided exclusive M&A advisory services through its investment bank, Presidio Merchant Partners LLC (member FINRA and SIPC). Founded in 1998 and based in Denver and Atlanta, the firm’s professionals have collectively closed more than 295 transactions totaling nearly $20 billion over their careers.
Key Takeaways
- FEP acquires Hartz Automotive’s stakes in three Penske-operated GM-brand dealerships in Los Angeles County.
- First California automotive investment for FEP; terms undisclosed.
- Deal advances FEP’s minority-investment strategy with permanent capital and geographic diversification.
- Presidio advises seller; multi-party, partial-interest structure required extensive coordination.
- No operational changes were specified in the announcement.
