US-based Lithia Motors is preparing to acquire Pendragon Vehicle Management

Pendragon Vehicle Management is set to acquire US-based Lithia Motors as part of a £250m deal for the wider automotive business.

Leaseco ranked 17th in last year’s FN50 list of the UK’s largest leasing companies, with a finance/risk car fleet and a van fleet of 13,111 vehicles.

In addition to PVM, the proposal, which has been approved by the Pendragon plc board and is subject to shareholder approval, will see the US company also acquire its dealership business, which includes the Stratstone, Evans Halshaw and Car Store brands.

The deal leaves Pinewood, Pendragon’s software division, as an independent entity that maintains Pendragon’s stock market listing.

It will be renamed Pinewood Technologies plc, as a pure-play software as a service (SaaS) company, headed by current Pendragon CEO Bill Berman and CFO Oliver Mann.

Lithia was recently named the largest automotive retailer in North America, following a series of acquisitions, and has 296 outlets in 26 states across the USA and Canada, representing 41 new vehicle brands.

Brian de Boer, CEO of Lithia, said: “The strategic partnership with Pinewood Technologies and the acquisition of Pendragon’s automotive and vehicle management divisions in the UK is a huge step in delivering on our long-term growth strategy.

“We are excited about the significant potential of Pinewood’s offerings and envision our strategic partnership to further expand our SaaS business globally.

“In addition, the proposed acquisition represents a highly synergistic growth opportunity with our existing UK presence with Jardine Motors Group; provides a new neighborhood with PVM; and expands our brand and geographic footprint while strengthening our existing relationships with OEMs.”

Ian Philby, Non-Executive Chairman of Pendragon, added: “Pendragon has made strong progress in executing its strategy in recent years and has successfully repositioned the company as a digitally-enabled automotive retailer.

“Today’s announcement follows an extensive strategic review conducted by the Pendragon Board of Directors to maximize value for our stakeholders.

“The proposed transaction provides shareholders with an immediate dividend close to the company’s market capitalization as well as continued ownership in an exciting technology company with improved growth prospects.”

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