The parent company of the Heritage Automotive Group, already one of Maryland's largest new-car retailers, announced yesterday that it has acquired two Saturn dealerships in the Baltimore area, the rights to a third in Annapolis and has taken on a new partner to help finance future expansion.
Steven B. Fader, president and chief executive of Summa Holdings, Ltd., said the company's Heritage unit acquired Saturn of Glen Burnie and Saturn of Ellicott City from Griffith Auto Investments.
Fader declined to disclose the purchase price.
Heritage also owns the Saturn outlets in Owings Mills, Towson and Bel Air, giving it a monopoly in the Baltimore area on the popular General Motors compact. Fader said GM had to approve each sale before the transactions could be completed.
To help pay for these purchases and future acquisitions, Fader said, David D. Smith has been made a part owner of Summa.
Smith is the president and chief executive of Sinclair Broadcast Group Inc., the Baltimore-based company that owns or controls 28 television stations, including Channel 45 (WBFF) and Channel 54 (WNUV) in Baltimore.
Fader declined to say how much money Smith brought to the company, characterizing it as "a significant" amount that would help Summa with future acquisitions as the retail auto industry goes into an anticipated major consolidation.
"This is a personal investment on his part," Fader said of Smith's involvement in Summa.
"It does not involve Sinclair. He will not be an officer of the company. He will not be a director."
Fader said it was as if Smith purchased stock in privately held Summa.
Smith could not be reached for comment yesterday.
Summa, based in Owings Mills, is the holding company of Heritage and Allstate Leasing Inc.
Summa recently acquired Magna Financial Corp., which was run by the Fader family and controlled the two subsidiaries.
Allstate, also in Owings Mills, leases autos, office supplies and construction equipment.
The purchase of the two Saturn franchises brings to 17 the number of new-car dealerships owned by Heritage in Baltimore, Anne Arundel, Howard and Harford counties.
"The auto industry is going through a major consolidation," Fader said. He estimates that the consolidation would affect more than 20 percent of the dealers in less than 10 years.
Fader said the formation of Summa, which includes his two brothers as well as Smith as investors, gives the company the capital needed to acquire other dealerships as they become available.
Fader said the company would likely open a Saturn dealership in Annapolis within the next 24 months.
As part of a strategic plan, he said the company is also looking at the possibility of moving into the used car superstore business that was started by Circuit City Inc. three years ago when it opened the first of its large CarMax used-car dealerships in Richmond, Va.
"We're currently reviewing the used-car superstore concept," Fader said, "but its too early in the process to say what we are going to do."
He said he was not certain that used-car customers preferred buying from a large lot with 1,500 cars or from the smaller used-car lot of a new-car dealership.
Pub Date: 1/21/97
