PENDRAGON is in discussions with rival car dealer Evans Halshaw about a possible takeover which, if it goes ahead, would create Britain's first £2 billion car retail group. An agreement is not expected until after Christmas.

If successful Pendragon would have control of more than 180 dealerships and huge areas of the country for the sale of volume brands such as Ford, Vauxhall, Fiat and Peugeot. Pendragon is offering £80 million in cash for Evans Halshaw, or 250p a share - well above the current share price of about 221p. Pendragon's acquisition of Evans Halshaw would create the country's biggest retailer of Ford and Vauxhall vehicles.