Sonic Automotive Inc. has accomplished what CEO David Smith has referred to as the group’s largest acquisition ever with its $700 million buy of RFJ Auto Companions Holdings Inc.

The acquisition, which was revealed in September and closed on Monday, consists of 22 franchised dealerships throughout Texas, Idaho, Washington, New Mexico, Missouri and Indiana. The deal additionally included 11 used-only shops in Washington, Idaho and Montana.

Sonic, of Charlotte, N.C., stated the transaction is predicted so as to add $3.2 billion in annual income.

“RFJ Auto’s geographic footprint, model portfolio and proprietary processes complement our current enterprise mannequin and align with our technique to proceed driving development in our franchised dealership enterprise,” Sonic President Jeff Dyke stated in a press release.

RFJ Auto, based mostly in Plano, Texas, fashioned in February 2014 when automotive retail veteran Rick Ford partnered with Jordan Co., a New York personal fairness agency.

RFJ Auto’s model portfolio is made up of Alfa Romeo, Chrysler, Dodge, Jeep, Ram, Maserati, Chevrolet, GMC, Buick, Lexus, Toyota, Ford, Nissan, Hyundai, Honda and Mazda.

Sonic stated the deal provides six new states to its footprint: Idaho, Indiana, Missouri, Montana, New Mexico and Washington. Mazda is a brand new model to Sonic’s automaker portfolio.

The general public group now has 111 new-vehicle dealerships.

RFJ Auto ranked No. 42 on Automotive Information‘ most up-to-date checklist of the highest 150 dealership teams based mostly within the U.S., with retail gross sales of 19,705 new autos and 28,448 used autos in 2020. The group generated income of $2.8 billion final 12 months.

Sonic ranks No. 7 on the checklist, retailing 93,281 new autos and 159,025 used autos in 2020 and producing income of $9.8 billion.

Rick Ford is staying on with Sonic as head operator of the RFJ Auto platform. Ford was a Sonic regional vp earlier in his profession and first met Dyke once they each labored at AutoNation Inc.

“I am personally excited to be rejoining the Sonic household, working alongside David, Jeff and the Sonic workforce to proceed delivering an distinctive expertise to shoppers throughout the nation,” Ford stated in a press release.

One RFJ dealership, Huge Spring Ford in Texas, was not a part of the sale to Sonic, Ford instructed Automotive Information in an e-mail, noting that the group already had a deal for it. Ford stated that transaction will possible shut in first quarter 2022.

Funding financial institution Lazard was Sonic’s monetary adviser within the transaction, whereas funding financial institution Cowen was RFJ Auto’s monetary adviser.

In October, Sonic closed on a personal providing of $1.15 billion in senior debt notes due 2029 and senior notes due 2031.

The corporate stated it deliberate to make use of proceeds from the providing, mixed with different debt, to fund the RFJ Auto acquisition in addition to to redeem excellent senior notes due 2027 and pay associated charges and bills.

The transaction is the second megadeal to shut in current weeks. Group 1 Automotive Inc. acquired most of Prime Automotive Group on Nov. 17.

Asbury Automotive Group Inc. plans to purchase Larry H. Miller Dealerships and its 54 new-vehicle shops by year-end.