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Mercedes Benz Financial Joins Group 1 Automotive

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On: Mon, Jul 12, 2010 at 10:25AM | By: Sherry Christiansen


Mercedes Benz Financial Joins Group 1 Automotive

Group 1 Automotive Company has announced this week that Mercedes Benz Financial has agreed to a partnership that would allow Mercedes to be part of a financial institution involving $1.35 billion dollars in revolving credit.

The Houston, Texas-based company Group 1 is a fortune 500 retail company, a leader in the industry. The company held its public offering in 1997 and has since become one of the top five groups of dealerships in the United States. Group 1 states that the company’s success has much to do with a “strategy that emphasizes geographic and brand diversity, interrelated revenue streams, operational efficiencies and the prudent deployment of capital.”

The lenders in Group 1’s syndicated lending facility now include Mercedes Benz Financial, Toyota Motor Credit Corporation, Nissan Motor Acceptance Corp., and BMW Financial Services NA LLC, along with 16 commercial banks, including Chase Bank, Bank of America, Citizens Bank, Deutsche Bank in New York, and more.

According to the group 1 VP and CEO, John Rickel, "We are delighted with Mercedes-Benz Financial's decision to join our floor plan and acquisition facility; the addition of a partner of this caliber is a plus for our credit syndicate and further expands our strategically important financial partnerships. We look forward to working with Mercedes-Benz Financial and our other financial partners going forward."

Group 1 Automotive owns over 100 dealerships and 136 franchises, as well as 25 collision service centers in the U.S. and Great Britain, selling new and used vehicles, and offering car repair services as well as insurance contracts and replacement parts.

So what will change for customers looking to finance a new or used Mercedes now that the merger has transpired? According to the press release posted on Yahoo News, "These risks and uncertainties include, among other things, (a) general economic and business conditions, (b) the level of manufacturer incentives, (c) the future regulatory environment, (d) our ability to obtain an inventory of desirable new and used vehicles, (e) our relationship with our automobile manufacturers and the willingness of manufacturers to approve future acquisitions, (f) our cost of financing and the availability of credit for consumers."

Yahoo financial news also reports that after the announcement, Shares of Group 1 fell 60 cents, or 25%, to $23.09 in afternoon trading.

In the most recent press release, there are many factors that the financial experts are uncertain about including the recession and the possible continuing decline of car sales.




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