Lithia sweetens deal to buy Pendragons UK dealership business
It comes amid a three-way bidding battle also involving US car retail giant AutoNation and Sweden’s Hedin.
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Your support makes all the difference.US firm Lithia has hiked its offer to buy rival Pendragon’s UK motor and leasing business.
It comes amid a three-way bidding battle also involving US car retail giant AutoNation and Sweden’s Hedin, which already owns a 28% stake in Pendragon.
Last month, Pendragon said it had agreed a deal worth around £280 million, or 27.4p per share, to sell the UK dealership operation to Lithia.
However, last week AutoNation put in an unsolicited takeover proposal worth around £447 million or 32p a share in cash to buy the whole company.
Hedin, which owns a 28% stake, then launched a joint unsolicited bid with Penske, which owns Britain’s bigger motor dealer, Sytner.
Pendragon rejected an initial 28p per share approach from the pair but then received a further proposed bid worth 32p per share and said it would consider the sweetened offer.
We are very excited about the strength of our strategic partnership and expanding the Pinewood business not just in the UK but around the world
On Monday, Lithia said it had now sweetened its approach for the UK operation to 35.4p, in a move worth £397 million.
The deal would also see Pendragon roll out its dealer management software arm, called 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.
Attempts by AutoNation and Hedin for a full takeover have been hampered by a need for 75% approval from shareholders.
However, the Lithia deal only needs majority approval in order to progress.
Bryan DeBoer, Lithia president and chief executive officer, said: “We have a pathway to reach completion quickly, proven experience in successfully integrating businesses and great growth opportunities for the Pendragon employees.
“We are very excited about the strength of our strategic partnership and expanding the Pinewood business not just in the UK but around the world.”