One company buys 13 dealerships in South Africa for R745 million

Combined Motor Holdings (CMH) plans to buy 13 properties used by its dealerships from three of its executive directors for R745 million.

The transaction, which was announced on the Johannesburg Stock Exchange’s Stock Exchange News Service on 19 August 2026, details 13 separate rental enterprises and their underlying properties.

The properties are already leased and occupied by businesses within the CMH group, meaning the deal will not result in an expansion with brand-new dealership locations.

Seven of the properties are located in Gauteng, while the remaining six are found in KwaZulu-Natal.

CMH Management, a subsidiary of CMH, is buying the properties from executive directors BWJ Barritt, SK Jackson and JD McIntosh. It also includes their associated family trusts.

The cash purchase of R745 million is below the properties’ combined independent valuation of R780 million, according to BusinessTech.

This means CMH is effectively getting a discount of around R35 million (4.5%) of the assessed market value.

CMH will make the purchase using R395 million in cash, along with a R350 million bank loan. The company said it has maintained surplus cash above operational requirements for years.

This, it said, gives it the capacity to make a substantial investment without draining its liquidity. The dealer group completed a R192 million share buyback in December 2025.

CMH has historically been both an operator and tenant of its dealer properties. In February 2026, the group reported lease liabilities of R544.7 million.

By purchasing the properties, it will reduce its lease and eliminate rental payments on the acquired assets. The company said this will have a positive effect on its earnings as the rental expenses it will eliminate outweigh the costs of the purchase, such as the finance cost of the loan and the lost interest on the cash.

However, the sale has not been processed yet because CMH must issue a detailed circular to shareholders and hold a general meeting, allowing general shareholders to take a vote.

Car dealers under siege in South Africa

While the CMH Group is preparing to make an enormous investment towards its continued growth in South Africa, smaller, independent dealers are struggling to stay afloat.

Thembinkosi Pantsi, Vice Chairperson of the National Automobile Dealers’ Association, warned that these businesses are struggling to survive in South Africa.

“Smaller independent dealers are under severe pressure in terms of the margin squeeze that we’re seeing in the industry. Customer footfall is not where we’d like it to be, and overheads remain high.”

Pantsi attributed this to a difficult operating environment with a stagnant economy, combined with an influx of new car brands in South Africa.

Unlike larger dealer groups with JSE listings, independent dealerships lack the financial reserves to adjust their business strategy to changing market conditions.

While car sales in South Africa have been on the rise for over a year, Pantsi said this needs to be contextualized, as the way in which many consumers buy a car has shifted.

“People no longer walk into dealerships. They do their research online. They know exactly what they want, sometimes right down to the specs and price, before they even engage with a dealer.”

While this benefits online platforms like AutoTrader, WeBuyCars, and Weelee, smaller outlets that rely on walk-in customers are struggling.