PENDRAGON has agreed to buy rival dealership Evans Halshaw for £83.7 million, creating the UK's largest motor retailer. The deal gives Pendragon control of more than 180 dealerships, considerable territorial control for the sale of Ford, Vauxhall, Fiat and Peugeot cars, and catapults the company into the market leader's position above Lancaster.

Included in the acquisition is Evans Halshaws' contract hire business Fleetcare, which on January 1 was relaunched as c.2K, and fleet management software company Car Fleet Control. Pendragon said there will be some selective asset disposal, including some if its own and Evans Halshaw's dealerships, and expects to make savings through greater efficiencies of at least £3 million a year.

Evans Halshaw is the UK's sixth largest car retailing group, operating 71 franchises from 64 dealerships. The offer values each of the company's shares at 260p. The deal came barely a fortnight after the Birmingham-based company revealed it was in talks with a potential buyer.