Financing kills Pendragon bid

THE £400m takeover of Britain’s second biggest car dealer has collapsed after a Swedish tycoon failed to secure financing.

Pendragon is understood to have agreed a deal in principle with the eponymous group owned by Anders Hedin at 29pashare at the end of November.

But the takeover slipped through Mr Hedin’s grasp because debt markets have largely dried up as inflation soars and central banks raise interest rates. Hedin Group and Pendragon had been close to finalising the deal three weeks ago, with the Pendragon board indicating it was willing to support the swoop, City sources said.

The car dealership market has been the most buoyant for years as a shortage in supply of computer chips from China props up prices.

But data from the Society of Motor Manufacturers and Traders show that exponential growth of electric car sales is tailing off. Hedin said on Friday: “Given the challenging market conditions and uncertain economic outlook, Hedin confirms that it does not intend to make an offer for Pendragon.”

One City source said: “The lending markets are really tough. The high cost of borrowing and the heavy demands on borrowers makes what was easy 12 months ago much less attractive today.”

Pendragon’s car dealer brands include Evans Halshaw, Stratstone and Car- Store. Hedin, which already owns about 25pc of Pendragon’s shares, has dealerships in Sweden, Switzerland, Norway and Belgium. Former Pendragon chief Trevor Finn had been linked with a comeback under the Hedin swoop, though City sources later played down the return of the man who masterminded much of Pendragon’s success.

Under City rules Hedin would typically not be allowed to return with another bid for six months.

However, the Swedish group said it reserved the right to make a bid if another party made an offer.