£110m sale of Dixon gets green light

DIXON Motors is to be bought by Royal Bank of Scotland's Lombard unit in a 300p-per-share cash deal, valuing the car distributor at £109.7m. The move means chief executive Paul Dixon and his son, managing director Simon Dixon, collect almost £8 million for their combined 7.26% stake in the group they founded 12 years ago.

Dixon's board, which revealed on 12 April that it was in talks with a potential buyer, said it was recommending the offer and that shareholders representing 59.3% of the group's equity supported the sale.

The offer is a 42% premium to Dixon's price before the announcement of talks and a 1.7% premium to last Friday's 295p closing price. Under the terms of the deal, shareholders are entitled to a second, 7.5p-per-share dividend. The shares today rose 3 1/2p to 298 1/2p.

Dixon operates 94 car and motorcycle sales operations and RBS' online car distribution unit, jamjar.com, accounted for about 6,000 of 94,609 vehicles it sold last year.