Minnesota auto group adds to dealership stable
Delano Sports Center is conglomerate’s second powersports purchase
A Twin Cities business group with stakes in the entertainment, retail, financial, commercial real estate, technology and automotive industries has purchased a Polaris, Victory Motorcycle and KTM dealership in the southwest corner of the metro area and merged it with the first powersports dealership it purchased that is located in the same town.
Pohlad Companies is a privately-held, family-run business based in the Twin Cities that owns the Minnesota Twins baseball team, River Road Entertainment movie production company, as well as a Minnesota radio station, various banks, commercial real estate operations and several automotive dealerships under the Twin Cities Automotive (TCA) banner in and around the Minneapolis-St. Paul metropolitan area.
Its recent acquisition of Delano Sports Center from longtime owner Butch Donahue marks the group’s second powersports purchase, with both dealerships located in Delano.
After closing on the sale in late November, Delano Sports Center was closed and its inventory and four staff members were transferred just down the road to Pohlad Companies’ first powersports purchase, Star West Motorsports, a Honda, Arctic Cat and Yamaha dealership located at 471 Babcock Blvd. in the small farming community 40 minutes west of Minneapolis.
“Acquiring these important brands helps us broaden our overall portfolio offering,” said Jay Hulbert, president of TCA. “We’re especially delighted to bring Polaris onboard, a manufacturer that commands a 50 percent market share.”
Donahue, owner of Delano Sports Center since 1973, started the business with an initial $2,000 investment he scraped together to enter an industry based around his love of motorcycles.
“As I hand over the reigns to Twin Cities Automotive, I wish them the best,” he said in a statement. “I know they’ll bring the resources to bear on ensuring the continued presence and success of powersports in the Delano area.”
Star West Motorsports expanding
With the added staff members providing a combined 60 years of experience in powersports and the addition of three new brands, Star West Motorsports has begun planning for a 4,000-square foot expansion of its showroom. Construction for the addition is slated to begin in the spring.
Brad Braun, CFO for TCA, said the company originally acquired the assets of Star West Motorsports when it purchased the adjacent Star West Chevrolet in November 2012. It felt there could be both selling and cost synergies between the two businesses, Braun said. Adding the assets from Delano Sports Center to its stable is a reflection of the company’s expectation for growth in the powersports industry. Braun said that the company currently does not have plans to further invest in the powersports market in or beyond of the Twin Cities market.
Tom Stifter, general manager of Star West Motorsports, is particularly motivated by the addition of Polaris, and said the company is currently negotiating with Ducati about adding its motorcycles to the store’s roster. He added that he is excited about the new team members, and the prospect of selling Polaris snowmobiles after the Upper Midwest saw significant early-season snowfall in December.
“The four guys we picked up have a combination of over 60 years of experience, so we’re excited about that; we’re excited about the brands — it’s had an immediate impact on our business,” he said. “We’re busting at the seams right now with inventory. We’ve got to go quick. Right now we’ve got snowmobiles out in the cold; we’re trying to show people and that’s no fun.”
With only a few weeks selling the combined product lineup, Stifter said sales of the Polaris Ranger have already exceeded his expectations.
“Our Rangers, in the 10 days we’ve had them, have outsold everything else,” he added. Stifter feels bullish about the remaining snowmobile season and expects that Honda and Polaris will be the company’s best sellers going forward.