British automotive business Pendragon has announced that it will sell its UK motor and leasing firms to Lithia for £250 million ($310 million). In addition to the sale, the two firms have agreed to a strategic partnership that consists of the expansion of Pendragon’s dealer management software program (DMS) enterprise to North America. This partnership will involve Lithia Motors’ current 50 UK web sites working with Pendragon’s Pinewood DMS, as effectively as the creation of a joint venture to accelerate Pinewood’s entry into the North American DMS industry.
Pendragon views this transaction as the culmination of a strategic evaluation that was announced final year, and expects it to deliver an eye-catching money dividend to shareholders of around £240 million. As portion of the agreement, Lithia will also subscribe to 279.four million new ordinary shares in Pendragon for £30 million. The sale and subscription will let Pendragon to retain its listing on the London Stock Exchange, although altering its name to Pinewood Technologies Plc.
This partnership and sale represents a considerable move for each Pendragon and Lithia, as they seek to expand their presence and capabilities in the automotive industry. Pendragon is confident that this transaction will bring worth to its shareholders, although Lithia sees an chance to leverage Pendragon’s DMS experience to boost its operations in the UK and enter the North American industry.