30 January 2024 , 10:57
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Car dealership Inchcape is considering selling its UK retail division, following reports that the company has been reaching out to potential buyers.
The firm confirmed it has received "approaches from a number of interested parties," and is now weighing up its options, which could include a sale. Sky News reported that the London-listed group might be seeking a new owner for its retail division, which employs 3,700 people in the UK.
The company operates 70 sites across the country, selling cars from brands such as Toyota, Volkswagen, BMW and Audi. Inchcape told investors on Monday: "The board of Inchcape notes the recent press speculation in relation to our UK retail business.
"Inchcape confirms that following approaches from a number of interested parties it is reviewing strategic options for the UK retail business, which potentially could include a sale. "This review is at a very early stage and there can be no certainty that it will result in a transaction."
Sky reported that Inchcape has hired bankers from Rothschild to oversee the discussions, with analysts suggesting the deal could be worth several hundred million pounds. Following the report, shares in the business rose by around 4.6%.
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However, shares had previously been down, so were only 0.8% up on the day. Inchcape, a global car distributor, could boost its profits by focusing more on its distribution business if it sells off its UK dealerships.
This comes as the company reveals that 90% of its profits come from this sector. This potential sale follows other big deals in the UK car industry. Last year, Lookers was sold to a firm controlled by Canada's Alpha Auto Group for a whopping half a billion pounds.
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