Major UK car dealership suffers ANOTHER blow as 160 stores on chopping block & major firm pulls out bid
A MAJOR UK car dealership has suffered another blow as it faces closing 160 stores – after a large firm pulled out of a bid.
Pendragon, Britain’s second largest motor retailer, had been in takeover talks with Swedish-based car dealer Hedin Group.
But shares in the British firm plummeted today after a potential offer was taken off the table.
Instead, Hedin Mobility Group and US company PAG International confirmed they do not intend to make an offer for the business.
The decision to walk away from the takeover race saw shares in Pendragon tumble by more than seven per cent.
It comes after Pendragon said last month it had agreed a deal worth around £280 million, equivalent to 27.4p per share, to sell the UK dealership operation to US firm Lithia Motors.
But following the announcement, Pendragon said it had received unsolicited takeover proposals from US car retail giant AutoNation and a joint bid from Hedin and PAG – a subsidiary of Penske.
Hedin already owns a 28 per cent stake in Pendragon, while PAG owns Britain’s biggest motor dealer Sytner.
The three-way bidding battle prompted Lithia to increase its offer to 35.4p per share, worth around £397 million, in an attempt to sweeten the deal.
The Lithia deal would see Pendragon roll out its dealer management software arm, Pinewood, to Lithia’s UK sites and to enter the North American market.
The firm would remain listed on the London Stock Exchange and change its name to Pinewood Technologies.
Last month, Pendragon said Lithia was “perfectly placed” to build on the expansion of the group.
Meanwhile, AutoNation’s possible offer is understood to be worth around £447 million to buy the whole company.
It comes as another major car firm has slashed EV production as demand for electric models falls.
Meanwhile, another popular car dealership has closed without telling customers.