Marshall Motor Holdings has acquired family-owned SG Smith Holdings for £24.4 million.

The deal includes a retention of £1.7m subject to certain performance conditions and the completion of certain property developments and finalisation of accounts.

Marshall has acquired the entire issued share capital of SG Smith from Robert Smith (the son of the founder and managing director) and certain other family and non-family individual investors. Smith will remain with Marshall for some months to assist with the integration process.

SG Smith has been family-owned since the 1930s and has dealerships across Kent, Surrey and London, representing Audi, Skoda and a Mercedes-Benz commercial vehicle aftersales franchise.

The acquisition gives Marshall an extension with one of its key franchise partners Audi, as well as strengthening its geographic representation in the UK with sites in Wimbledon, Coulsdon, Bexley, Beckenham and Croydon.

Marshall said the acquisition was funded from its existing cash resources and is expected to be earnings enhancing by the end of next year.

The dealer group said that because of the timing of the acquisition following the September plate-change, it may be “marginally dilutive” for the financial year ending December 31, 2015. In addition, Marshall has incurred transaction fees and expenses in connection with the acquisition of approximately £0.5m.

Daksh Gupta, Marshall group chief executive, said the acquisition was in line with the group’s strategy to grow scale with existing brand partners and expand its geographic footprint.

Gupta said: “The business is a good cultural fit for the group and we are delighted to be significantly growing our relationship with Audi, strengthening our Skoda representation and extending our partnership with Mercedes Benz in commercial vehicles."

Smith said: "After over 70 years, it was important to our family to find a good home for our business and our people.

“The acquisition brings together two long standing organisations with a rich history in automotive retail. I would like to thank the entire SG Smith team and wish them well with Marshall Motors over the coming years."