Note 15 - Acquisitions

12 Months Ended

Dec. 31, 2012

Business Combination Disclosure [Text Block]

(15)         Acquisitions

We completed the following acquisitions in 2012:

● On April 30, 2012, we acquired the inventory, equipment and intangible assets and assumed certain liabilities of Bellingham Chevrolet and Cadillac in Bellingham, Washington from Jerry Chambers Chevrolet.

● On June 12, 2012, we acquired the inventory, equipment and intangible assets and assumed certain liabilities of Fairbanks GMC Buick from Gene’s GMC, LLC.

● On August 27, 2012, we acquired the inventory, equipment and intangible assets and assumed certain liabilities of Killeen Chevrolet in Killeen, Texas from Connell Chevrolet, Inc.

● On October 23, 2012, we acquired the inventory, equipment, real estate and intangible assets of, and assumed certain liabilities related to Bitterroot Toyota of Missoula, Montana from Bitterroot Motors, Inc.

These acquisitions contributed revenues of $32.2 million for the year ended December 31, 2012.

We completed the following acquisitions in 2011:

● In April 2011, we acquired the inventory, equipment, real estate and intangible assets of, and assumed certain liabilities related to, Mercedes-Benz of Portland, Oregon, Mercedes Benz of Wilsonville, Oregon and Rasmussen BMW/MINI in Portland, Oregon from the Don Rasmussen Group.

● In October 2011 we acquired the inventory, equipment, real estate and intangible assets of Fresno Subaru from Herwaldt Automotive Group.

We completed the following acquisitions in 2010:

● In July 2010, we acquired the inventory, equipment and intangible assets and assumed certain liabilities related to Honda of Bend and agreed to the transfer of Chevrolet and Cadillac brands from Bob Thomas Chevrolet Cadillac, both located in Bend, Oregon.

● In August 2010, we acquired the inventory, equipment, real estate and intangible assets and assumed certain liabilities related to Toyota of Billings from Prestige Toyota, located in Billings, Montana.

The results of operations of the acquired stores are included in our Consolidated Financial Statements from the date of acquisition.

Pro forma results of operations are not materially different than actual results of operations for the 2010 acquisitions. The following unaudited pro forma summary presents consolidated information as if the 2012 and 2011 acquisitions had occurred on January 1 of the prior year (in thousands, except for per share amounts):

Year Ended December 31,	2012		2011		2010
Revenue	$	3,386,066	$	2,789,436	$	2,210,073
Income from continuing operations, net of tax		80,064		56,904		14,779
Basic income per share from continuing operations, net of tax		3.12		2.17		0.57
Diluted income per share from continuing operations, net of tax		3.06		2.13		0.57

These amounts have been calculated by estimating and applying our accounting policies. The results of these stores have been adjusted to reflect depreciation on a straight-line basis over our expected lives for property, plant and equipment; accounting for inventory on a specific identification method; and recognition of interest expense for real estate financing related to stores where we purchased the facility. No nonrecurring pro forma adjustments directly attributable to these business combinations are included in the reported pro forma revenues and earnings.

All acquisitions were accounted for as business combinations under the acquisition method of accounting. No portion of the purchase price was paid with our equity securities. The following table summarizes the consideration paid for material acquisitions and the amount of identified assets acquired and liabilities assumed as of the acquisition date (in thousands):

Consideration paid for year ended December 31,	2012		2011
Cash paid, net of cash acquired	$	44,716	$	55,368
Floor plan financing assumed		-		19,348
	$	44 ,716	$	74,716

Assets acquired and liabilities assumed for year ended ended December 31,		2012			2011
Inventories	$	17,541		$	29,268
Franchise value		5,174			14,517
Property, plant and equipment		11,097			17,351
Real estate lease reserves		-			325
Other assets		110			1,475
Reserves		-			(663	)
Capital lease obligations		(2,609	)		-
Other liabilities		(307	)		(426	)
		31,006			61,847
Goodwill		13,710			12,869
	$	44,716		$	74,716

The fair values of assets acquired and liabilities assumed in our 2010 acquisitions are not material to our Consolidated Balance Sheets.

In July 2011, we were awarded a Ford franchise in Klamath Falls, Oregon which was accounted for as an asset acquisition. Consideration of $5.1 million was paid for the inventory, equipment and associated real estate.

We account for franchise value as an indefinite-lived intangible asset. We expect the full amount of the goodwill recognized to be deductible for tax purposes. We did not have any material acquisition related expenses in 2012, 2011 or 2010.