TIDMPDG
RNS Number : 1203Y
Pendragon PLC
28 December 2023
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF SUCH JURISDICTION
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
28 December 2023
Pendragon PLC ("Pendragon" or the "Company")
Update on the Disposal, Subscription by Lithia, Strategic
Partnership, and proposed Board changes
Pendragon is pleased to announce that the FCA Conditions have
now been satisfied after both Pendragon and Lithia received
approval from the FCA for the change of control of Pendragon
Finance and Insurance Services Limited.
As a result, and in accordance with the terms of the Sale
Agreement, the completion date for the sale of the entire issued
share capital of Pendragon NewCo 2 Limited, the entity that holds,
either directly or indirectly through its wholly-owned
subsidiaries, Pendragon's UK motor business (sale and servicing of
vehicles in the UK) and leasing business (fleet and contract hire
provider and used vehicle supply), to Lithia is expected to take
place, following the satisfaction of the remaining customary
completion conditions, on 31 January 2024 ("Disposal Completion")
alongside the completion of the Subscription to Lithia and entry
into the Strategic Partnership with a wholly-owned subsidiary of
Lithia Motors, Inc..
Completion of the Transaction will mark the beginning of the
transformation of Pendragon into Pinewood Technologies, a pure-play
SaaS business, which operates the Company's dealer management
software business. The Board strongly believes that the growth
prospects for the Company will be enhanced materially as a result
of becoming a standalone business, as well as through the Strategic
Partnership with Lithia.
Outstanding Conditions
The Reorganisation Condition and the Pensions Condition remain
outstanding and are expected to be satisfied on or before 31
January 2024.
Satisfaction of the Reorganisation Condition is within the
control of Pendragon.
The Pensions Condition has been addressed by all relevant
parties executing the documentation necessary to satisfy this
Condition. Satisfaction of the Pensions Condition remains subject
to a technical statutory formality which cannot be addressed
earlier than Completion and which is therefore expected to be
addressed on Completion.
Transaction Dividend to Shareholders
Following completion of the Transaction, the Company confirms
its intention to return a cash amount equivalent to approximately
24.5 pence per Ordinary Share to Shareholders by way of a special
dividend (the "Transaction Dividend"). The Transaction Dividend is
now expected to be paid in Q1/Q2 2024.
Under the terms of the Transaction, Lithia will waive all rights
and entitlements to the Transaction Dividend in respect of the
Subscription Shares.
Employee share incentive arrangements
The Company shall issue 40,979,118 new Ordinary Shares (the "EBT
Shares") to Accuro Trustees (Jersey) Ltd, trustee of the Pendragon
Employee Benefit Trust (the "EBT") which shall be used to satisfy
awards and options granted under certain of the Company's employee
share incentive arrangements. A listing application has been made
by the Company for the EBT Shares to be admitted to the premium
listing segment of the Official List and to trading on the London
Stock Exchange's main market for listed securities (the "Main
Market") ("EBT Admission"). Admission of the EBT Shares is expected
to occur at 8.00 a.m. on 31 January 2024. Immediately following the
issue of the EBT Shares, the EBT will hold 67,520,919 Ordinary
Shares representing approximately 4.62 per cent. of the Company's
issued share capital.
The EBT Shares will be issued fully paid and will rank pari
passu in all respects with the existing Ordinary Shares.
Subscription by Lithia
In connection with completion of the Subscription, a listing
application has been made by the Company for 279,388,880 new
Ordinary Shares (the "Subscription Shares") to be admitted to the
premium listing segment of the Official List and to trading on the
Main Market ("Subscription Admission"). Admission of the
Subscription Shares is expected to occur at 8.00 a.m. on 1 February
2024.
The Subscription Shares will be issued fully paid and will rank
pari passu in all respects with the existing Ordinary Shares (save
as detailed above in relation to the entitlement of the Transaction
Dividend).
Director Appointments and Resignation
Pursuant to the terms of the Subscription, Transfer and
Relationship Agreement, Lithia will have the right to nominate up
to two non-executive directors ("Lithia Nominee Directors") to be
appointed to the Board of Pinewood Technologies for so long as
Lithia holds 10 per cent. or more of the voting rights of the
Company. In connection thereto, Chris Holzshu, Chief Operating
Officer of Lithia, and George Hines, Chief Technology Officer of
Lithia, will be appointed to the Board by Lithia as the Lithia
Nominee Directors with effect from Subscription Admission.
Additionally, and as previously notified, Mark Willis will step
down as Director and Chief Financial Officer of the Company and his
successor, Oliver Mann, will be appointed as Director and Chief
Financial Officer of the Company. Mark's resignation and Oliver's
appointment will take effect from Disposal Completion.
The Company confirms that there is no further information
relating to Chris, George and Oliver that requires disclosure under
Listing Rule 9.6.13R.
The Lithia Nominee Directors will be considered non-independent
for the purposes of the Corporate Governance Code. Nevertheless,
following Subscription Admission, the Board shall continue to
comprise a majority of independent non-executive directors.
Defined terms used in this announcement have the same meaning
where used, or otherwise defined, in the Circular of the Company
dated 20 September 2023 or the Supplementary Circular of the
Company dated 9 October 2023, unless otherwise defined herein.
Enquiries:
Jefferies International Limited (Sponsor, Financial +44 (0) 20 7029
Adviser and Joint Corporate Broker) 8000
Philip Noblet
Thomas Bective
Jordan Cameron
+ 44 (0) 20 3207
Berenberg (Joint Corporate Broker) 7800
Ben Wright
+44 (0) 20 3805
Headland Consultancy (PR & Communications) 4822
Henry Wallers
Jack Gault
IMPORTANT NOTICE
The contents of this announcement have been prepared by and are
the sole responsibility of Pendragon.
This announcement contains inside information. The person
responsible for arranging this announcement on behalf of Pendragon
is Richard Maloney, Group General Counsel and Group Company
Secretary.
Jefferies International Limited ("Jefferies"), which is
authorised and regulated in the United Kingdom by the Financial
Conduct Authority, is acting solely for the Company, and for no-one
else, as financial adviser in connection with Admission and the
Transaction (as amended by the Transaction Amendments) and as
sponsor in connection with Admission and the Disposal and will not
be responsible to anyone other than the Company for providing the
protections afforded to its clients or for providing advice to any
other person in relation to Admission, the Disposal and the
Transaction (as amended by the Transaction Amendments) , the
content of this announcement or any other matters described in this
announcement. To the fullest extent permitted by law, neither
Jefferies nor any of its affiliates assumes any responsibility
whatsoever for or makes any representation or warranty express or
implied, in relation to the contents of this announcement,
including its accuracy, completeness or verification or for any
other statement made or purported to be made by it, or on its
behalf and nothing contained in this announcement is, or shall be,
relied upon as a promise or representation in this respect whether
as to the past, present or future, in connection with the Company,
the Group, the Disposal Group, the Continuing Group, Admission, the
Disposal or the Transaction (as amended by the Transaction
Amendments) . Jefferies and its affiliates accordingly disclaims to
the fullest extent permitted by law all and any duty,
responsibility and liability whether arising in tort, contract or
otherwise which it might otherwise be found to have in respect of
this announcement or any such statement or otherwise.
This announcement is not intended to, and does not constitute,
or form part of, any offer to sell or an invitation to purchase or
subscribe for any securities or a solicitation of any vote or
approval in any jurisdiction.
This announcement has been prepared for the purpose of complying
with the applicable law and regulation of the United Kingdom and
information disclosed may not be the same as that which would have
been disclosed if this announcement has been prepared in accordance
with the laws and regulations of jurisdictions outside the United
Kingdom.
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END
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December 28, 2023 13:14 ET (18:14 GMT)
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