An international corporate has dropped a £400 million bid for the Nottingham car sales business Pendragon, and talks about a deal have been terminated.
The dealer group said it had put the offer to its five biggest shareholders – and got “strong” support from four – but had not been able to get a conclusive answer from one. Pendragon said it was still set up for growth over the coming months.
Founded in 1989, it represents more than 20 vehicle manufacturers at more than 160 sites across the UK under the Evans Halshaw, Stratstone and Car Store brands. It sells new and used vehicles and provides aftercare services, as well as fleet and leasing services.
Last year the business made pre-tax profits of £83 million on sales of almost £3.5 billion and sat in third place in the latest BusinessLive East Midlands Top 500 Companies list.
It recently estimated pre-tax profits of £33 million for the first six months of this year.
In an update to the markets the Pendragon board said it had received a non-binding cash offer for the entire business at 29p a share. Shares are currently trading at around 24p.
The update said: “The board of Pendragon concluded that the proposal merited engagement with its five largest shareholders and received strong support for the proposal from four of these shareholders who were willing to sign irrevocable commitments.
“However, Pendragon was unable to engage with one of these shareholders and therefore, given this lack of certainty, the bidder has withdrawn its non-binding offer and both parties have terminated discussions.
“The company continues to expect to deliver group underlying profit before tax in line with board expectations.
“The board has full confidence in the company’s strategy and in management to continue to deliver significant value for all stakeholders.”
Back in March Sky News said Hedin Group, Pendragon’s biggest shareholder, tabled an offer to buy the company which was later rejected.
