Penske Automotive to buy truck distributor

Penske Automotive to buy truck distributor for $200M, setting sights on Australia, New Zealand

Associated Press

BLOOMFIELD HILLS, Mich. (AP) -- Penske Automotive Group plans to buy a business that distributes trucks, spare parts and related services across Australia, New Zealand and Southeast Asia.

Penske, based outside Detroit in Bloomfield Hills, Mich., said Sunday that it signed a deal to buy Western Star Trucks Australia from Transpacific Industries Group Ltd. Western Star Trucks distributes heavy- and medium-duty trucks through independent dealers under its own name and for Germany-based MAN Truck & Bus, which is majority-owned by Volkswagen, and Dennis Eagle, which makes vehicles for waste collection. The Western Star truck brand is an affiliate of Daimler Trucks North America.

Penske said it expects to pay about $200 million for the business. It said the purchase will reduce third-quarter results by 2 cents per share. But excluding those costs, it expects the purchase to add 10 cents to 14 cents per share to annual earnings.

Penske sells new and used vehicles and also does vehicle maintenance and repair.

The sale is expected to close by the end of September. Penske is scheduled to report second-quarter earnings results Wednesday.

Penske Automotive Group Inc. shares closed Friday at $34.25, up about 14 percent since the start of the year.

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