{"id":870909,"date":"2026-08-19T12:00:00","date_gmt":"2026-08-19T10:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=870909"},"modified":"2026-08-19T13:18:37","modified_gmt":"2026-08-19T11:18:37","slug":"major-car-company-buys-13-dealerships-for-r745-million-from-its-own-directors-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/870909\/major-car-company-buys-13-dealerships-for-r745-million-from-its-own-directors-in-south-africa\/","title":{"rendered":"Company to pay three directors R745 million for 13 car dealerships in South Africa"},"content":{"rendered":"\n
Combined Motor Holdings (CMH) is set to spend R745 million to acquire 13 properties used by its dealerships from three of its executive directors and their associated family trusts.<\/p>\n\n\n\n
The transaction, announced on the JSE\u2019s SENS on 19 August 2026, involves 13 separate rental enterprises and their underlying properties.<\/p>\n\n\n\n
Six are located in KwaZulu-Natal and seven in Gauteng. The properties are already leased and occupied by businesses within the CMH group, meaning the deal does not involve an expansion into new dealership locations.<\/p>\n\n\n\n
Instead, CMH Management, a subsidiary of CMH, is buying the properties from executive directors BWJ Barritt, SK Jackson and JD McIntosh, together with associated family trusts.<\/p>\n\n\n\n
The cash purchase price of R745 million is below the properties\u2019 combined independent valuation of R780 million, giving CMH an effective discount of about R35 million, or 4.5%, to the assessed market value.<\/p>\n\n\n\n
CMH will fund the acquisition using R395 million of its existing cash resources and a R350 million bank loan.<\/p>\n\n\n\n
The company said it has maintained surplus cash above its operational requirements for several years, giving it the capacity to invest in properties without exhausting its liquidity.<\/p>\n\n\n\n
The acquisition follows a R192 million share buyback completed in December 2025. The company had also accumulated substantial cash resources, with its balance sheet showing more than R1 billion in cash.<\/p>\n\n\n\n
The deal is significant because CMH has historically been both an operator and tenant of its dealership properties.<\/p>\n\n\n\n
At the end of February 2026, the group reported lease liabilities of R544.7 million. Bringing the properties onto its balance sheet will reduce its reliance on leases and eliminate rental payments associated with the acquired properties.<\/p>\n\n\n\n
CMH said the transaction is expected to have a favourable effect on future earnings, as the rental expenses avoided are expected to outweigh the interest income forgone on the cash used in the acquisition and the financing costs associated with the new debt.<\/p>\n\n\n\n
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