Bidder drops out of fast-paced Pendragon takeover race

One of the bidders in the race to buy out Nottingham-based car retailer Pendragon has pulled out.

The joint bid by Sweden’s Hedin Mobility Group and Leicester-based PAG International, which owns the Sytner brand, have withdraw their £447m offer for Pendragon, which runs the Evans Halshaw and Stratstone outlets.

The offer represented a 32p-per-share deal for shareholders from Hedin and PAG and came after Pendragon said that the firm’s UK motor and leasing businesses could be be sold to Lithia UK Holding, a subsidiary of Lithia Motors.

A statement from Pendragon said: “Hedin and PAG confirm that they do not intend to make an offer for Pendragon.”

Pendragon’s share price dipped sharply upon the news and closed yesterday (October 4) down almost 6.7% at 32.85p.

Pendragon and Lithia Motors had previously agreed the terms of a strategic partnership with Lithia, including the rollout of Pinewood, the company’s dealer management software (DMS) business, to Lithia’s existing 50 UK sites and the creation of a joint venture to accelerate Pinewood’s entry into the North American DMS market.

The firm last week increased its offer to £397m.

US firm AutoNation has also tabled a £447m offer for Pendragon.