Announcing a deal Sunday valued at more than $360 million, Lithia Motors and DCH Auto Group entered a definitive agreement to combine their companies — a transaction that would merge two of the largest dealer groups in the country.

Per the agreement, Lithia will buy up the entirety of DCH’s outstanding shares for approximately $340 million in cash and $22.5 million — or approximately 300,000 shares — of Lithia common stock.

Once the deal is closed, DCH’s 27 stores will be combined with Lithia’s 101 stores.

This transaction would stretch the dealer body reach of Lithia — whose dealers currently are all located in the Western U.S. — from coast to coast.  DCH’s stores are located in Southern California, New Jersey and New York.

DCH’s current management will continue to lead the DCH stores, as president George Liang will report to Lithia president and chief executive officer Bryan DeBoer.

Once the deal is finished, DCH founder Shau-Wai Lam will likely join Lithia’s board of directors.

DeBoer said: “For the past several years, we have been seeking a strategic partner to help us to enter the Eastern United States. The DCH organization is an ideal fit with our existing team. We share similar strategic goals and core values, and have complementary strengths.

“DCH has proven their ability to ‘Deliver Customer Happiness’ while executing a high volume strategy in metro markets. Lithia embodies continuous improvement and produces sector leading operating efficiency. Together, the organization will be able to grow in multiple markets, learn from each other, and deliver improved efficiencies due to scale,” he added.