Mayank Bansal, CFA
Mayank Bansal is a CFA Charterholder and heads the Equity Research team at Kapitales Research, with over 5 years of experience analysing global equity markets. He leads fundamental, data-driven research combining rigorous financial analysis with macro trends.
Eagers Automotive to Acquire Remaining 20% Stake in BYD Retail Joint Venture
Highlights:
Eagers Automotive Moves Towards Full Ownership of BYD Retail Venture
Eagers Automotive Limited (ASX: APE) announced on 26 October 2026 that it had entered into a binding, unconditional agreement to acquire the remaining 20% ownership interest in EV Dealer Group Pty Ltd, the entity operating its BYD Retail Joint Venture. The transaction will give the automotive retailer full ownership of the venture by eliminating the remaining non-controlling interest. The company's shares were last quoted at AU$18.950, up AU$0.359 or 1.936%, according to the supplied market data. The acquisition is expected to strengthen its ownership position in the BYD retail venture and support earnings growth.
Under the agreement, the acquisition will be funded through a combination of cash consideration and ordinary shares in Eagers Automotive. The company expects the transaction to be completed by 31 October 2026. The move represents a step towards consolidating ownership of the BYD retail business within the group, allowing Eagers Automotive to hold the entire interest in the joint venture entity following completion.
Acquisition Expected to Support Earnings Growth
Eagers Automotive expects the transaction to be 5.0% to 5.5% earnings accretive for shareholders. This estimate is based on pro forma underlying operating profit before tax for the 12 months ended 30 June 2026. The company noted that the pro forma calculation includes CanadaOne earnings for the period from 1 July 2025 to 30 June 2026. These figures are unaudited, while underlying operating results represent continuing operations adjusted for significant items.
The projected earnings accretion indicates that the acquisition is expected to contribute positively to the company's underlying earnings performance. However, the anticipated benefit remains an estimate and will depend on the transaction's completion and subsequent business performance.
Proposed Share Issue to Form Part of Consideration
In a related Appendix 3B announcement dated 26 October 2026, Eagers Automotive disclosed plans to issue up to 1,126,779 fully paid ordinary shares as part consideration for acquiring the shares of EVDirect.com 2 Pty Ltd, the shareholder entity associated with the remaining 20% interest in EV Dealer Group Pty Ltd.
The proposed issue is scheduled for 30 October 2026, with the securities valued at approximately AU$21.10 million for disclosure purposes. The new shares are expected to rank equally with the company's existing ordinary shares and will be subject to voluntary escrow for 12 months following completion of the acquisition, subject to customary exceptions. The company stated that shareholder approval would not be sought for the entire issue, with the proposed shares to be issued using its 15% placement capacity under ASX Listing Rule 7.1.
Conclusion
Eagers Automotive's planned acquisition will consolidate its ownership of the BYD Retail Joint Venture and is expected to deliver earnings accretion of 5.0% to 5.5%. Investors will be watching for completion by the end of October and the subsequent contribution of the fully owned business to the group's financial performance.
Note: All data presented is based on information available at the time of writing.
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