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Monday, March 20, 2023

Pendragon suitor Lithia Motors in ‘superior’ talks over £300m Jardine acquisition

Lithia Motors has revealed that it views Jardine Motors as “a platform for future development within the UK” after it emerged the US-based automotive retailer was in superior talks to accumulate the AM100 group.

Lithia, which made a bid to accumulate Pendragon final yr, is known to be lining up a takeover value about £300 million, in keeping with a report revealed by Sky Information in the present day (January 23).

The AM100’s ninth-placed automotive retail group, with a turnover of £1.61 billion, Jardine employs round 2,700 individuals at 50 websites throughout the UK and counts manufacturers together with Aston Martin, Audi, BMW, Ferrari, Jaguar Land Rover (JLR), Porsche and Pininfarina amongst its franchise companions.

In a assertion issued to Sky Information, $22.8bn (£19bn) turnover New York Inventory Trade-listed Lithia Motors mentioned it had beforehand said its “need to broaden into the UK market” and confirmed that it had held discussions with Jardine Motors Group proprietor, Hong Kong-based Jardine Matheson, with a view to investing within the automotive retail enterprise.

It added: “Jardine Motors Group UK is likely one of the UK’s main automotive retailers and Lithia firmly believes {that a} mixture of the 2 companies will assist to ship important worth for workers, companions and prospects.

“Lithia views the potential acquisition of Jardine Motors as a platform for future development within the UK and plans to put money into the enterprise, working with Jardine Motors’ market-leading administration staff to construct on the robust momentum the Group has generated lately.

“Discussions round a possible transaction are ongoing and an extra replace might be issued in the end.”

Lithia’s bid to accumulate Pendragon was revealed by Sky Information again in August.

It got here in-between two approaches by Hedin Automotive for the previous AM100-topping retail group, the latter of which was withdrawn after the Swedish automotive retail group entered the UK market by way of the acquisition of dealerships from Mercedes-Benz Retail Group.

If accomplished, Lithia’s acquisition of Jardine Motors Group could be bigger than different latest large-scale M&A offers within the UK’s automotive retail sector – Marshall’s acquisition of Motorline and Vertu’s takeover of Helston Garages – within the shade.

A information perception report revealed by AM late final yr discovered that the local weather for automotive retail M&A was “hotting-up” within the UK, with abroad traders in pole place.

Alistair Cassels, head of automotive advisory at MHA, mentioned: “Over the previous 5 years we have now seen quite a lot of abroad entrants, together with Motus, Tremendous Group and Group 1, and we all know there’s nonetheless quite a lot of urge for food from these abroad companies to accumulate extra.

“As for different newcomers, like Hedin, some may need grown as a lot as they will of their house territory and be in search of a brand new alternative. Others might be seeking to profit from what’s – in some methods – fairly a beneficial local weather for M&A exercise.”

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