Car dealer Tony Bramall is to receive a £76m windfall when he sells the company he founded to Pendragon, making it the largest UK car retailer.

Harrogate-based CD Bramall was established by Mr Bramall in 1990 with three Rover car dealerships. It is to be bought by Pendragon for £230m in cash.

Pendragon and CD Bramall both have deals with Jaguar, Mercedes and BMW, among others, and the merged group will be able to boost its buying power with the manufacturers. Pendragon has 109 outlets in the UK while CD Bramall has 111.

The two groups have benefited from a Brussels ruling last October which gives car retailers greater powers over manufacturers. The powers are likely to encourage more mergers in the sector, according to Pendragon chief executive Trevor Finn, who said very few job cuts are planned.

Pendragon yesterday said its profits for last year would be higher than expected, boosted by increasing consumer confidence and the new legal framework. However, it warned yesterday its borrowings would increase significantly after the merger.

Mr Bramall owns 33% of the business and is to vote in favour, while other directors and major shareholders Jupiter Asset Management and Framlington Investment Management have agreed to back the deal. The CD Bramall directors will leave the company once the deal is done.

Mr Bramall, however, is not expected to pack up and head for a leisurely life by the seaside. "Tony is very active, I am sure that when one door closes, he will move on to other business interests," said CD Bramall chief executive Peter Jones.

Shareholders are receiving 600p per share - and may also gain more if CD Bramall wins a tussle with the tax man that could bring in a few million pounds.