AutoCanada has sold three British Columbia dealerships for approximately $32.2 million in gross proceeds, a move the retailer’s CEO says, “reflects our disciplined approach to capital allocation.”

The group announced last week that it completed the sale of Island Chevrolet in Duncan, Abbotsford Volkswagen in Abbotsford and Chilliwack Volkswagen in Chilliwack, three stores that “operated outside of AutoCanada’s core regional operating clusters, limiting opportunities to realize operating scale and efficiency,” the company said.

“As a result, the assets did not meet the Company’s return thresholds and represented an opportunity to unlock capital for debt reduction and investment in high-return opportunities,” AutoCanada said.

The gross proceeds from the sale included $28.8 million for goodwill and fixed assets, excluding inventory and net working capital, and $3.4 million for real estate.

The stores generated a combined $111 million in revenue for the trailing 12 months ending in the first quarter and incurred a combined net loos of $1 million.

“This transaction reflects our disciplined approach to capital allocation,” AutoCanada CEO Samuel Cochrane. “While we are committed to growing our dealership network across Canada, we will not tolerate assets that do not meet our long-term return objectives.

“Where we see a path to improved performance, we will act decisively to execute a turnaround,” Cochrane said. “Where we do not, we will redeploy capital into opportunities that deliver stronger returns and greater value for our shareholders.”