The Zeigler Auto Group acquired Jeep and Ferrari franchises in May. Good personal chemistry between Aaron Zeigler and the dealerships’ owners created a pleasurable and efficient deal process for both.

Finally getting a Jeep store

When Chrysler was going through bankruptcy proceedings in 2008, the Zeigler Auto Group was awarded Chrysler, Dodge and RAM franchises in Kalamazoo, MI. The Michigan-based dealership group anticipated adding a Jeep franchise in the future.

That finally happened in May when Zeigler Auto Group acquired Jeep Kalamazoo from the LaFontaine Auto Group.

“We always figured at some point we'd be able to get (all four brands) put back together. It probably took a little longer than what I thought,” Aaron Zeigler, president and CEO of Zeigler Auto Group, tells Getting to Go!

The deal came together very quickly. The LaFontaine Group had the standalone Jeep store in Kalamazoo but wanted to move a Mercedes-Benz franchise to that location, Zeigler says.

LaFontaine’s lawyer reached out to the Zeigler Group’s in-house counsel asking if the Zeigler Group would be interested in acquiring the Jeep franchise. It was.

He and Ryan LaFontaine, whom he had never met, met for lunch about six weeks ago, Zeigler says.

The deal “came together really quick,” Zeigler says. “It was one lunch, about an hour of chit chatting and eating, and about 2 minutes on the deal, and we shook hands and went on our way.”

The transaction “solved two problems at once,” Zeigler says.

A stand-alone Jeep franchise didn’t make much sense for the LaFontain Group, which wanted to use the real estate for something else. And the Zeigler Group wanted and had space for a Jeep franchise.

There was no haggling over price. He agreed to the initial asking price from LaFontaine, Zeigler says. It was a bit more than he had in mind, Zeigler says, but less than one million dollars more.

“I buy a lot of stuff,” he says. “So, we’re both pretty experienced as to what the values should be on these and what’s fair. The only way you can buy a lot of deals is to be fair with the other side.”

Included in the deal was that LaFontaine’s certified Jeep technicians would come to work for Zeigler, as well as the Jeep salespeople. Everyone else at the Jeep dealership moved to other positions within the LaFontaine Group.

The Jeep franchise will almost double the Zeigler Group’s service business, Zeigler says.

The Jeep franchise will be relocated down the street to Zeigler’s existing Chrysler Dodge RAM store in Kalamazoo. Thinking ahead, Zeigler included space for the Jeep brand when the facility was built, Zeigler says.

He will add specific Jeep elements to the current facility.

“It is kind of fun to do something in your hometown,” Zeigler says.

Going exotic

The Zeigler Automotive Group also acquired its first exotic brand franchise in May, becoming the owner of Ferrari Lake Forest in Illinois. The deal also included Pagani, Koenigsegg, and Automobili Pininfarina franchises.

“It’s a really big Ferrari store and it’s a whole new world for us,” Zeigler says. “But that was kind of a dream to have a Ferrari store. They’re really hard to come by.”

The transaction started to come into shape last fall when Zeigler received a call from an investment bank asking if he would be interested in acquiring the exotic brand dealership from the Mancuso family, who had owned it for 40 years.

Ferrari stores are “extremely expensive,” Zeigler says, but the store “is a really good fit.”

He knew Nick Mancuso and they chat on a regular basis,” Zeigler says. “I always really like Nick, and I thought, ‘boy, I’d love to work with him someday’.” Then the bank call came through.

The Mancuso family will continue to run the Ferrari dealership, Zeigler says.

“They’re very, very impressive people,” he says. “Ferrari thinks very, very highly of them.”

The family sold the exotic franchises to create generational wealth, Zeigler says.

“They didn't have to sell,” he says, “They said they would sell if they came up with the right situation, and the right situation wasn't necessarily money. It was the vision, and my vision and their vision really aligned.”

The final element was that the families really liked each other and got along well, Zeigler says.

The Zeigler Group has 84 franchises across 41 locations in Wisconsin, Illinois, Indiana, and Michigan.

It doesn’t have a specific number of franchises in mind as to how big it wants to be, Zeigler says.

It is very strategic and selective in what it acquires, he says. A store has to fit the profile it is looking for, and the Group has to have the capacity to take it on.

“We want to be in good markets with the best franchises,” Zeigler says. “When we find that, we are willing to pay good money for it.”

This article was written for Getting to Go, a buy/sell newsletter from Scali Rasmussen.