Prime Automotive settles suit, selling dealerships for $880M
BOSTON (AP) — Massachusetts-based Prime Automotive Group has signed a $30 million settlement with ex-CEO David Rosenberg, who was fired after raising concerns about financial wrongdoing.
The settlement last week cleared the way for Group 1 Automotive Inc. of Houston to purchase Prime Automotive from New York-based GPB Capital Holdings for $880 million, The Portland Press Herald reported Monday.
Prime Automotive Group has 30 dealerships and three collision centers in the Mid Atlantic and New England.
After his firing, Rosenberg moved to sell his shares in the company, but filed suit in Massachusetts alleging he wasn’t fully compensated for the sale.
GPB Capital’s then-chief executive was arrested and charged with defrauding investors — he has since stepped down — and GPB also faces civil lawsuits.
Prime Automotive faced pressure from car manufacturers like Toyota and Volkswagen, which threatened to pull their franchise agreements unless the dealerships were sold or Rosenberg rehired.
In a story published Nov. 22, 2021, The Associated Press reported that GPB Capital’s chief executive has been arrested and charged with defrauding investors. It was updated Nov. 24, 2021, to make clear that the person arrested has since resigned as GPB Capital’s chief executive and no longer has a role in the day-to-day operations of the company.