(Reuters) - British auto retailer Pendragon Plc (PDG.L) said on Monday it was no longer exploring merger talks with rival Lookers Plc (LOOK.L), after a media report over the weekend said that Lookers rejected its approach.
The coronavirus shut downs have taken a toll on auto retailers, which were already struggling with a fall in demand and a squeeze on margins in the past year under the weight of Britain’s long-drawn exit from the European Union.
Lookers, which has seen a management shake up in the past few months, is undergoing a fraud investigation into its operating divisions after an initial probe found misstatements in its balance sheet and fraudulent expense claims.
Lookers’ stock has more than halved in value this year as of Friday’s close, while Pendragon’s shares have lost about 37% of their value during the period.
Sky News had reported here that Pendragon approached Lookers about a potential merger last month, but Lookers rejected the approach.
Pendragon declined to comment on whether it was exploring other such combinations.
Reporting by Tanishaa Nadkar and Yadarisa Shabong in Bengaluru; Editing by Rashmi Aich