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Dixon touted to buyers before receivers called

Pendragon was able to act quickly to secure 19 of Dixon Motors’ 46 outlets because the business was touted around up to three weeks before Royal Bank of Scotland pulled the plug.

One dealer group boss told AM: “We were offered some franchises weeks ago, so the receivership didn’t come as a surprise.”

Pendragon chief executive Trevor Finn confirmed he was offered sites before the receivership. “We picked our purchases for geographic fit. The price for the package was good value,” he added.

Royal Bank of Scotland, which sold Dixon in September 2005 to a management buyout headed by John Haines but remained its banker with a 20% stake, called in receivers from BDO Stoy Hayward on July 26 after Dixon’s board deemed the group insolvent.

That was despite Haines’ efforts to cut costs. On becoming chairman of Dixon, the former director of Inchcape’s Pacific Rim operations was confident of turning the struggling business into a success. He immediately sold 11 outlets and closed its vast PDI centre in Thorne to reduce debts.

AM called Haines shortly before going to press. He was driving in France and couldn’t comment, but promised to call on his return in mid-August.

RBS declined to comment on whether it withdrew funding for Dixon and put it into administration. It also declined to comment on Dixon’s management.

Pendragon was the only dealer group that made BDO’s tight four-day deadline for bids, closing a deal for 19 Dixon sites for £17m.

It secured around 600 jobs at four Citroën sites (Bradford, Doncaster, Hull and Rotherham), two Ford (Bury and Rotherham), one Kia (Rotherham), three Nissan (Doncaster, Hull and York), three Peugeot (Mansfield, Wakefield and Doncaster), two Renault (Hull and York) and four Vauxhall dealer-ships (Beverley, Horsforth, Hull east and Hull west).

BDO said it closed Dixon’s remaining 27 sites due to a lack of interest from buyers. Around 800 employees were made redundant.

One motor retail analyst told AM: “The management team disposed of some sites because the manufacturers wouldn’t go with the new ownership – that included some of the better bits. They shut Thorne and moved the head office to smaller premises. You’d have thought they lost cost and would make the turnaround.

“Why didn’t they? Either flat out incompetence or RBS decided automotive was non-core and wanted to get rid by pulling the plug. It was all done very quickly and the manufacturers were the last to know.”

Manufacturers look to close open points

Ford, Nissan, Kia, Hyundai, Citroën, Peugeot, Renault and Vauxhall are searching for retail partners in Yorkshire following the collapse of Dixon Motors. Most of the open points are in sizeable towns and cities.

Nissan GB issued terminations to all 12 Nissan dealerships operated by Dixon shortly after the group entered receivership. It is now seeking to appoint franchises in Barnsley, Grimsby, Halifax, Huddersfield, Lincoln, Scunthorpe and Sheffield, and has been in urgent talks with dealer prospects. The outlets closed in Worksop and Birstall were “non-core” and will not be replaced.

A spokeswoman said the Nissan dealerships in Doncaster, York and Hull bought by Pendragon from the receivers “will be staffed as normal and will continue service as normal” in the short term. Permanent representation is uncertain at present, while Nissan GB decides “if or how this partnership is to continue in the long term”.

Pendragon already has Nissan franchises in the UK, including Leeds, Bradford, Darlington, Middlesbrough, Sunderland, Mansfield, Aberdeen and Bedford.

Ford and Renault both told AM that they are working with the receivers and dealer partners in the area to ensure their customers are serviced.

Citroën has dealers interested in Birstall, Halifax, Scunthorpe and Wakefield. According to a spokesman they are all profitable sites. He said Citroën is “working with customers to try and reach a mutually agreeable position” to honour deposits paid.

Kia, which had one site closed at York, is in talks with existing franchise holders and some new dealers. It is also “endeavouring to honour any orders by arranging delivery via another Kia dealer”.

Vauxhall, the only carmaker to admit it is owed money by Dixon, is finalising the purchase of its Selby site. Menston has closed. “We are reviewing the opportunity at Menston,” said a spokeswoman.

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