Shares of Pendragon Group (LSE:PDG) PLC surged 30% in early trading following a twin-pronged deal worth £280 million.
The Nottingham-based car dealer is offloading its motor and leasing businesses for £250 million to Lithia UK Holding Limited, a subsidiary of North American automotive retailer Lithia Motors.
The deal also includes a strategic partnership between Pendragon and Lithia Motors, focusing on the expansion of Pinewood, Pendragon's dealer management software (DMS) business.
Pinewood will be rolled out to Lithia's 50 existing UK sites and a joint venture will be created to fast-track Pinewood's entry into the North American DMS market.
As part of the agreement, Lithia has also agreed to acquire £30 million worth of new Pendragon shares.
As part of the restructuring, Pendragon will rebrand as Pinewood Technologies, retaining its current listing on the London Stock Exchange.
At 8.47 am, the shares were up 5.49p at 23.97p.