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MARKET REPORT: Pendragon slumps after Swedes pull takeover bid

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MARKET REPORT: Pendragon slumps after Swedes pull takeover bid – automotive dealer says Hedin decided against tabling offer for shares it doesn’t own

Pendragon suffered a blow yesterday after its largest shareholder walked away from a proposed takeover. 

The automotive dealer said that Hedin Mobility, the family-owned Swedish motor retailer which holds a 27.59 per cent stake, decided against tabling a proposal for the shares it doesn’t own attributable to ‘difficult market conditions and the uncertain economic outlook’. 

Shares, which have fallen nearly 13 per cent this 12 months, plunged one other 28.4 per cent, or 8p, to twenty.2p following the news. The corporate behind brands equivalent to Evans Halshaw and Stratstone tried to place a superb spin on the failed deal, claiming the method had ‘highlighted the worth of Pendragon’. 

Difficult conditions: Pendragon suffered a blow after its largest shareholder walked away from a proposed takeover

Hedin Mobility approached Pendragon on September 21 with a money offer of 29p a share, which valued the business at £400m. On the time, Hedin said it ‘believes within the long-term potential of Pendragon’ but insisted the approach may not lead to a firm offer. 

AJ Bell investment director Russ Mould said: ‘Automobile retailers were in strong demand through the pandemic as a shortage of recent vehicles and a sudden jump in demand for used cars made the market red hot. That bubble now seems to have burst as people watch their pennies and find ways to maintain their existing motor running for longer relatively than in search of an upgrade or change over.’ 

The FTSE 100 edged up 0.06 per cent, or 4.46 points, to 7476.63 and the FTSE 250 rose 0.5 per cent, or 91.99 points, to 18916. Oil prices inched up 0.1 per cent to $76 a barrel but remained 10 per cent below the beginning of this week amid fears over the health of the worldwide economy.

Commerzbank analyst Carsten Fritsch said: ‘The EU’s oil embargo against Russia, and the G7 price cap on Russian oil that got here into force initially of this week, have been just as powerless to forestall this because the easing of coronavirus restrictions in China and robust Chinese crude oil imports have.’ 

Because of this BP fell 0.4 per cent, or 2p, to 461.95p and Shell was down 1 per cent, or 23.5p, to 2286p. 

Guinness owner Diageo sank 0.9 per cent, or 33p, to 3743p after Jefferies cut the its goal price to 4300p from 4500p. 

Meanwhile, Unilever, the patron goods giant behind brands equivalent to PG Suggestions, Marmite, and Ben & Jerry’s, also swung into reverse after Deutsche Bank lowered the goal price to 4400p from 4500p. Shares inched down 0.8 per cent, or 35.5p, to 4125.5p. 

There was higher news for Intercontinental Hotels Group. 

The owner of Holiday Inn and Crowne Plaza is ‘underappreciated within the UK market’, in accordance with Peel Hunt, which upgraded its rating to ‘buy’ from ‘hold’ and raised the goal price to 5750p from 4600p. At a result, shares gained 4.1 per cent, or 194p, to 4986p. The mining giant Anglo American was also certainly one of the blue-chip index’s largest fallers, down 3.3 per cent, or 109.5p, to 3190p, after it warned that it was likely to jot down down the worth of the Woodsmith fertiliser mine near Whitby in North Yorkshire after project delays and price overruns. 

Among the many mid-cap stocks, investors in Man Group cheered following the launch of a share buyback programme price as much as £101.61m ($125m). Shares within the UK investment manager added 5.3 per cent, or 10.9p, to 215.2p. 

Meanwhile, Porvair, which makes filters to be utilized in anything from aeroplanes to food factories, soared 11.5 per cent, or 61p, to 590p after saying that its revenue growth for the 12 months to November is predicted be around 18 per cent higher than 2021. 

Industrial equipment supplier Crestchic agreed to be snapped up by the portable power firm Aggreko for 401p a share or £122m. Shares surged yesterday by 11.8 per cent, or 42p, to 398p.

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