12th Apr 2006 07:01
Lookers PLC12 April 2006 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES OFAMERICA, CANADA, AUSTRALIA OR JAPAN 12 April 2006 Lookers plc ("Lookers") Vehicle manufacturer notifications In its offer document posted to Lookers shareholders last week, Pendragon plc("Pendragon") sought to convince Lookers shareholders that the acquisition ofLookers was low risk from a manufacturer perspective. The Board of Lookers has previously stated its concerns about the high level ofcommercial risk for Pendragon in relation to manufacturer relationships thatcould lead to a loss of value for Lookers shareholders if they were to exchangetheir shares in Lookers for shares in Pendragon. With regard to Pendragon's claim, Lookers announces that in total, franchisesgenerating £326 million of revenues in the year ended 31 December 2005,representing 26.5% of Lookers' total revenues, are considered to be at risk. In the event of a change of control of Lookers, the manufacturers that arerepresented by these franchises have the right under the existing franchise orother agreements to terminate their agreements, or to require the franchisebusiness to be transferred back to the manufacturer. Indeed, Lookers announces today that it has already received writtennotifications from three of its vehicle manufacturer partners stating theirintention to discontinue in whole or in part their relationships with Lookers inthe event of Lookers being acquired by Pendragon. These operations generated£224 million of revenues in the year ended 31 December 2005, representing 18.2%of Lookers' total revenues. Ken Surgenor, Chief Executive, said: "On 20 March we announced outstandingresults for 2005 and excellent current trading. This reflects the success of ourdevelopment strategy which is supported by our manufacturer partners. Thenotifications that we have recently received highlight the substantialcommercial risks of Pendragon's all paper offer. We strongly urge Lookersshareholders not to put the value of their investment in Lookers at risk byaccepting this wholly inadequate offer from Pendragon" The Board of Lookers will be writing to shareholders next week to explain itsreasons for recommending rejection of this all share offer from Pendragon.Shareholders are urged to take no action before receiving the document to besent to Lookers shareholders which will be posted by no later than 20 April2006. Enquiries: Ken Surgenor 0161 291 0043 David Dyson Lookers plc Andrew Thomas 0161 827 3800 N M Rothschild & Sons Limited Andrew Hayes 020 7796 4133 Nick Lyon James Hill Hudson Sandler Christopher Wilkinson 020 7776 1530 Numis Securities This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
LOOK.LPDG.L