Mega truck dealer Rush Enterprises has announced it will acquire the assets of Salt lake City-based Lake City International and is forming a division responsible for operating dealerships that offer International and other vehicle brands produced by Navistar. Lake City is the second International dealer. San Antonio-based Rush, long known as a Peterbilt dealer chain, acquired its first International dealership in 2008.
Lake City International currently operates five dealerships in Utah, five dealerships in Idaho and a dealership in Oregon. Its business represents multiple brands, including International, Autocar, Mitsubishi Fuso, IC Bus and Collins Bus. The proposed acquisition would expand the Rush’s contiguous network of Rush Truck Centers and would result in the company operating 60 of those locations in 14 states.
Rush said it “intends to group the management of its Rush Truck Centers into a Peterbilt division that will be responsible for the operations of Rush’s dealerships that sell and service products manufactured by Peterbilt Motors Co. and a Navistar division responsible for the operations of Rush’s dealerships that represent products manufactured by Navistar, Inc., including International trucks and IC buses.” Senior management of each new division will report directly to W.M. “Rusty” Rush, president & CEO of Rush Enterprises, but the two divisions will otherwise remain operationally independent from one another.
"The acquisition of Lake City International and the reorganization of the management of our Rush Truck Centers represent an important milestone for our company,” said Rusty Rush. “ The proposed acquisition will enable us to expand Rush’s geographic footprint further across the Western United States, providing significant entry into Utah and Idaho, and providing an opportunity to build the relationship we started with Navistar and its International brand when we acquired Rush International Truck Center – Charlotte in 2008.”
Rush reported it had audited revenues of $1.2 billion for the year ending 2009, while Lake City International had unaudited revenues of $121.9 million. Rush estimates that the purchase price for the assets of Lake City International will be approximately $76.5 million, comprised of approximately $44 million for assets and goodwill and $34.5 million for real estate less a $2.0 million payment from affiliates of Lake City International for Rush assuming contingent liabilities of approximately $4.9 million.
At closing, Rush anticipates it will finance approximately $28.5 million of the purchase price under its floor plan, accounts receivable and lease and rental truck financing arrangements. The company said it intends to finance a portion of the purchase price of the real estate shortly after the closing of the acquisition. Rush also said it expects the transaction “to be accretive to future earnings.”
Completion of the deal is subject to several conditions, including approval by International Truck and Engine Corp. and IC Bus, both divisions of Navistar, Inc., as well as by Autocar LLC and Mitsubishi Fuso Truck of America, Inc.
"The acquisition of Lake City International and the reorganization of the management of our Rush Truck Centers represent an important milestone for our company,” said Rusty Rush. “ The proposed acquisition will enable us to expand Rush’s geographic footprint further across the Western United States, providing significant entry into Utah and Idaho, and providing an opportunity to build the relationship we started with Navistar and its International brand when we acquired Rush International Truck Center – Charlotte in 2008.”
“We look forward to adding Lake City International’s locations to the Rush Truck Centers network of dealerships and welcome the employees of Lake City International into the Rush Enterprises organization. Lake City is a very well run and highly regarded dealer group within the International
