Motor Trader The award-winning and longest running UK magazine for car retailing professionals. Your first stop for News, Jobs and Reports for the motor industry.
Pendragon has announced shareholder approval to sell its UK motor retail and leasing businesses to Lithia Motors for £367m, then transition to a pure-play software business under the Pinewood Technologies name.
Subject to completing, the deal will see c. 24.5p distributed to shareholders in Q1 2024 and Lithia subscribing to 16.6% of shares in the ongoing listed entity, leaving existing holders with 83.3%.
Zeus Capital commented: 2We think there is significant value potential in the ongoing Pinewood business, particularly under the growth plan with Lithia, which, in our view, is not captured in the current share price.”
Lithia Motors is taking on all Pendragon’s UK Motor and Pendragon Vehicle Management debt and pension liabilities. Lithia will also subscribe to £30m of shares in the new Pinewood Technologies business, equivalent to a 16.6% stake.
Whilst shareholder approval has been received, the deal’s completion is subject to certain conditions. Completion is expected in Q4 2024. Zeus forecasts will be updated in due course.
Pinewood currently has c. 32k users of its software, primarily focused in Europe, Africa, and Asia.
Lithia in lead as AutoNation pulls out of bidding war for Pendragon