LONDON (AFX) - Pendragon PLC, the UK's largest car dealer, could be forced to pay at least 33 mln stg more to complete its takeover of rival Reg Vardy PLC, despite appearing to have tied up a 506 mln stg deal, if hedge funds and proprietary traders play hard to get, the Financial Times reported.
Pendragon announced last week that it had acquired or agreed to acquire 40.4 pct of Vardy's share capital, and had irrevocable undertakings to accept its 900 pence-a-share bid from shareholders representing a further 10.6 pct of the stock.
The statement came after Lookers PLC, a much smaller dealership, baulked at topping its 875 pence-a-share offer.
However, hedge funds and proprietary traders that have exposure to a quarter of Vardy stock are believed to be holding out for a higher offer from Pendragon, the newspaper said.
One source close to the takeover battle said the hedge funds are looking for 10.00 stg a share, according to the newspaper.
Together, the hedge funds and prop traders could prevent Pendragon from taking control of 75 pct of Vardy, meaning it would not be able to squeeze out minority shareholders or de-list the company. newsdesk@afxnews.com ml/slm
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Pendragon announced last week that it had acquired or agreed to acquire 40.4 pct of Vardy's share capital, and had irrevocable undertakings to accept its 900 pence-a-share bid from shareholders representing a further 10.6 pct of the stock.
The statement came after Lookers PLC, a much smaller dealership, baulked at topping its 875 pence-a-share offer.
However, hedge funds and proprietary traders that have exposure to a quarter of Vardy stock are believed to be holding out for a higher offer from Pendragon, the newspaper said.
One source close to the takeover battle said the hedge funds are looking for 10.00 stg a share, according to the newspaper.
Together, the hedge funds and prop traders could prevent Pendragon from taking control of 75 pct of Vardy, meaning it would not be able to squeeze out minority shareholders or de-list the company. newsdesk@afxnews.com ml/slm
COPYRIGHT
Copyright AFX News Limited 2005. All rights reserved. The copying, republication or redistribution of AFX News Content,inculding by framing or similar means, is expressly prohibited without the prior written consent of AFX News.
AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
For more information and to contact AFX: www.afxnews.com and www.afxpress.com