20/05/2024 1:05 PM


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Kia dealership sues LMP Automotive following failed acquisition

A Connecticut Kia dealership this week sued LMP Automotive Holdings Inc., alleging breach of contract and seeking $100,000 in deposits held in the unsuccessful acquisition. But a lawyer for the dealership stated a resolution might presently be in the performs.

K & W Enterprises and Ash Road Holdings sued LMP and 1st American Title Coverage Co. in federal court in Connecticut on Monday. The dealership and real estate firm allege LMP breached the buy agreement to invest in Kia of East Hartford and property when LMP unsuccessful to submit all required information and facts to Kia Motors America.

LMP wanted to get hold of producer acceptance to near the offer. And due to the fact of that alleged breach of contract, the dealership and actual estate firm think they are entitled to the deposits.

The dealership, owned by Joseph Klimas Jr., entered into a purchase and product sales arrangement with LMP in July for extra than $9 million. Revenue was deposited in escrow with the title firm. A closing was slated to take place by Feb. 28, according to the complaint, and the plaintiffs say they terminated the offer on March 1.

On Feb. 18, Kia of East Hartford acquired a letter from Kia Motors that it had been notified by LMP that the transaction had been terminated and that Kia would no longer examine LMP’s application, in accordance to the grievance.

In February, publicly traded auto retailer LMP introduced it was exploring strategic solutions for the firm, which include selling its eight franchised dealerships and four employed-auto stores, right after it was unable to secure financing to near seven pending transactions. The Fort Lauderdale, Fla., firm said it meant to terminate all of those transactions.

LMP, in a regulatory submitting, mentioned the acquisition of Kia of East Hartford and house was terminated on March 11 and that it failed to anticipate any “content termination penalties” associated to the canceled offer.

In some of LMP’s other canceled acquisitions, the seller kept deposits, some as huge as $2 million.

Robert Feiner, a Hartford, Conn., attorney for Kia of East Hartford, stated in a late Thursday email to Automotive News that “the events have agreed to resolve any disagreement in between them matter to finalizing appropriate documentation.”

The dealership and actual estate firm experienced sought damages, in addition prices, in addition to be awarded the $100,000 in deposits.

As of mid-Friday afternoon, there were being no up to date court filings for the case.

LMP executives did not react to requests for comment on the lawsuit or possible resolution.

LMP was slated to share its fourth-quarter earnings on Thursday but in a information release stated it would hold off the launch of its effects. It did not give a new date.