Pendragon accelerates ‘comprehensive review’ in light of Hedin takeover bid

Pendragon is accelerating its plans to conduct a “comprehensive review” of its business in light of Hedin Group’s £411 million bid to take over the PLC.

A statement issued via the London Stock Exchange said that the car retail group – once the AM100’s top-ranking by turnover – would be analysing all potential options to deliver shareholder value.

It comes after the Swedish retailer revealed its intention “not to retain” Pendragon’s Pinewood Technology division in the long term, should its 29p per share bid prove successful.

Pendragon’s statement said: “The board continually evaluates all options to maximise shareholder value, although this review will be accelerated following the announcement made by the company on 26 September 2022 regarding a possible cash offer from Hedin Mobility Group.

“The Pendragon business is made up by its market-leading Evans Halshaw and Stratstone brands, an omnichannel used car offering, a highly differentiated SaaS dealer-management division and a highly profitable and cash generative leasing business.

“The Board remains excited about the future prospects for all parts of the company.

“However, in light of the possible cash offer from Hedin Group which the Board is currently considering together with its financial and legal advisers, the board will consider all options in order to maximise shareholder value.

“This review will include potential options with respect to each major Pendragon business, in part as a result of an indication from the Hedin Group outlined in their proposal, that it is not their intention to retain the Pinewood SaaS division for the long term and would seek an appropriate partner for the Pinewood business.”

Announced via the London Stock Exchange earlier this week, Hedin’s bid for Pendragon is its second this year and the third takeover bid for the group during 2022.

US-based car retail group Lithia Motors was linked to a second bid for the business, which was rejected after a “major shareholder” – believed to be Hedin Group – refused to engage in discussions.

Earlier this week Hedin Group, which became Pendragon’s largest shareholder earlier this year, revealed that it would not engage with any other party interesting in mounting a takeover bid.

It said: “Hedin Mobility believes in the long term potential of Pendragon and will not consider or accept any other offers for its current shareholding in Pendragon.”