GPB Capital Sells Prime Automotive Group Dealerships for $880M

GPB Sells Remaining Prime Automotive Group Dealerships to Group 1 Automotive

According to a regulatory filing submitted on September 13th, 2021, the private equity firm is selling all of its Prime Automotive car dealerships to Group 1 Automotive Inc. for $880M. The sale includes GPB Automotive Portfolio’s remaining 30 stores and three collision repair shops. 

GPB Auto is one of the alternative asset firm’s largest funds, and it has been selling car dealerships since at least 2018 when it owned 52 of them. It is one of the largest GPB funds and has reported huge losses. 

This latest sale comes as the alternative asset firm continues to face fraud lawsuits from the Securities and Exchange Commission (SEC) and six states. In February, the private equity firm agreed to have an independent monitor oversee operations. Meanwhile, former GPB founder David Gentile and two other executives are facing criminal fraud charges.

GPB Capital acquired a majority stake in Prime Automotive in 2017. SEC filings note that in 2020, GPB Automotive generated a net loss attributable to the partnership of about $19.3M on $2.38B of revenue for the year. 

In a regulatory filing in May 2021, GPB Auto stated that there was significant doubt that its Prime Auto business would be able to survive. In an August 2021 regulatory filing, GPB Auto said it was thinking about selling more dealerships for the purposes of creating operational liquidity.

Hightower Securities Ordered to Pay GPB Capital Investor $163,201

In other GPB Capital news, on August 13, 2021, a FINRA arbitration panel in New York awarded an investor $163,201 in their GPB Capital Holdings investor claim against broker-dealer, Hightower Securities. 

The claimant had accused his broker at the firm of unsuitably recommending that he invest in GPB Waste Management, LP and GPB Automotive, LP. The award is a recovery of the claimant’s entire investment. 

GPB Capital Holdings is accused of running an over $1.7B Ponzi scam that has defrauded more than 17,000 investors.  Our GPB private placement lawyers at Shepherd Smith Edwards and Kantas (SSEK Law Firm) represent investors in their FINRA arbitration claims against the broker-dealers that sold GPB investments to customers. Call us at (800) 259-9010 today if you believe that you suffered losses when working with a Hightower Securities broker. 

Thousands of GPB Investors Have Suffered Devastating Losses 

The alternative asset firm is accused of using newer investors’ money to pay the dividends promised to earlier investors. Redemptions were suspended in 2018 and all of the GPB Funds have since reported significant losses. 

More than 60 brokerage firms marketed and sold GPB private placements to their customers, collectively earning more than $160M in commissions and fees in the process. These firms and their registered representatives ignored red flags and other early signs that GPB Capital was being run like a Ponzi scheme and stealing from investors. Many of these firms sold GPB private placements to customers for whom these investments were too risky and unsuitable.

Experienced GPB Private Placement Law Firm 

SSEK Law Firm has filed a number of GPB investor claims in FINRA arbitration against broker-dealers. To schedule your free, no-obligation case consultation with our skilled securities lawyers in New York, call SSEK Law Firm at  (716) 261-3529. For investors elsewhere in the United States, call (800) 259-9010.

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