The transaction will see Veho's annual turnover grow to €1.5 billion.

The contract covers four companies – Silberauto AS, Silberauto Eesti AS, Silberauto UAB, AS Silwi Autoehitus – their activities, showrooms and rights of resale. Real estate – showrooms and service centers in Estonia and Lithuania – will be retained by Kaldoja.

The transaction requires consent from the Estonian competition watchdog and Daimler AG.

Juha Ruotsalainen told ERR that the car industry is changing rapidly, meaning that being the largest in the country is no longer enough.

"This means you have to be the biggest in the region. It was one of Veho's strategic goals," he explained.

Ruotsalainen said Silberauto will continue as a separate company after the transaction goes through, and no great change is planned. The company will retain its name, offices and services, meaning that nothing will change for the client.

The CEO of Veho added that the price of the transaction is confidential.

Founder and owner of Silberauto Väino Kaldoja said the car market is heading for consolidation and that Veho, three times the size of Silberauto, will create additional opportunities for development and expansion for the company.

Kaldoja said he will direct his attention and energy toward the future. "Because I've always been intrigued by engineering, I will dedicate myself to inspiring young people, boosting their interest in technology and broadening their possibilities," he said.

Deputy chairman of the board at Veho, representative of the family that owns the company Philip Aminoff said the transaction marks a new era in Veho's 80-year development as the company's extensive experience with Mercedes-Benz in Finland and Sweden will be complemented by Silberauto's market position and know-how.

"It will form a brilliant whole," Aminoff said.

Silberauto is among the largest and oldest companies in Estonia. Silberauto started in June of 1990 in Estonia and has been active in Lithuania since 2002. The group's turnover amounted to €387 million and profit to €6.2 million last year.

In addition to representing trademarks of Daimler AG, Silberauto has been selling and servicing Jeep passenger cars since 2000, Mitsubishi since 2004 and Maserati since 2015. The company owns showrooms and service centers in Järve and Ülemiste in Tallinn, Tänassilma, Maardu, Tartu, Viljandi, Pärnu, Kuressaare, Rakvere and Jõhvi. Silberauto UAB's dealerships in Lithuania can be found in Vilnius, Kaunas and Klaipeda.

Finnish Veho is a car dealership founded in 1939 that is also active in Sweden and the Baltic countries. The firm's turnover amounted to €1.2 billion in 2018, with a fifth coming from Sweden and the Baltics. The company has been owned by the same family since its founding.

Download the ERR News app for Android and iOS now and never miss an update!