AutoCanada isn’t showing any signs of slowing down; shares continued to drive higher (up 88% year-to-date) on news that has purchased a 31% interest in Nicholson Chevrolet, based in Edmonton, Alberta. This is particularly impactful as it marks the company’s first agreement with a General Motors (GM) dealership. This suggests that original equipment manufacturer (OEMs) would warm up to public ownership in Canada, and will likely opens the door to further acquisitions of dealers outside of Chrysler Canada to AutoCanada. Through a newly created holdings company, AutoCanda will purchase a 31% equity interest, CEO Pat Priestner will purchase a 20% equity interest but retain 100% voting rights (which was likely a requirement from GM) and the current owners of Nicholson Chevrolet will retain a 49% equity interest. This transaction sets the stage for additional acquisitions under the GM banner. Management commented that AutoCanada would look to acquire 100% ownership in future acquisitions, with AutoCanada retaining an 80% equity interest, and Pat Priestner retaining a 20% interest and 100% of the voting rights, which again is believed to be a requirement from GM. Financials were not disclosed, although Canaccord Genuity Consumer Products Analyst Derek Dley expects more clarity during the company’s upcoming Q1/12 earnings results on Tuesday, May 8. While this announcement could potentially lead to an increase in dealership acquisitions from his previous assumption of one-to-two dealerships annually, Dley believes the company continues to remain committed to its dividend policy of distributing 70-80% of EPS.