Motor dealer Pendragon (LON: PDG) is accelerating a comprehensive review of strategic options following the bid approach from Hedin Mobility Group AB. The bidder is considering a 29p a share offer.
Pendragon’s main brands are Evans Halshaw and Stratstone. It also has used car business CarStore, the Pinewood SaaS-based dealer management division and a leasing business. In the first half of 2022, Pendragon reported a dip in underlying pre-tax profit from £35.1m to £33.5m after the ending of government support.
Zeus forecasts a fall in full year pre-tax profit from £84.4m to £55.3m. Net debt is forecast to fall to £32.7m at the end of 2022. Zeus estimates a sum of the parts valuation of 38.6p a share.
Management says that it is considering the bid along with the other options for individual businesses. Hedin Mobility does not want to retain the Pinewood SaaS business, which had interim revenues of £12.4m.
The potential bid is subject to limited due diligence and recommendation by the Pendragon board. Hedin Mobility says that it would bot consider any other offer – it is the largest shareholder with 27.1%. Other large shareholders include Schroder with 11.8%, Odey Asset Management with 10.3%, Briarwood Chase with 10%, Hosking & Co with 5.58% and Dimensional Fund Advisers with 3.2%.
