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Republic Wins Ruling on Buying Honda Dealers

September 30, 1997| From Bloomberg News

Republic Industries Inc. on Monday won a U.S. District Court order dismissing Honda Motor Co.'s lawsuit challenging its acquisition of dealerships, paving the way for Republic to continue buying franchises of the Japanese auto maker.

Honda's Torrance-based American Honda Motor Co. unit said it would appeal the ruling by the Los Angeles court and pursue actions to keep Republic from buying more than seven Honda and three Acura dealerships per state.

Republic, which argued that the limits are illegal, has already agreed to buy one Acura and eight Honda dealerships. Acura is Honda's luxury brand.

Coupled with a tentative settlement of a similar dispute with Toyota Motor Corp., the decision paves the way for the company controlled by investor H. Wayne Huizenga to continue to add dealerships to its 190 new-car dealers acquired since December. Florida-based Republic said it's interested in meeting with Honda to settle the dispute.

Honda's suit claimed that Republic violated laws against unfair competition and interfered with the agreements the car company makes with its dealers.

Republic shares rose $1.88 to close at $32.31 on the New York Stock Exchange. Honda's American depositary receipts fell 19 cents to close at $69.56.

Also on Monday, Republic agreed to sell its security business for $610 million to communications services company Ameritech Corp. The move would make Ameritech's SecurityLink the No. 2 security systems business, behind ADT Ltd. Huizenga last year tried and failed to buy ADT.

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