The AM100 dealer group Inchcape Retail UK is up for a takeover.
It has responded to reports by Sky News that its parent group Inchcape PLC, which is now almost exclusively a vehicle distributor/wholesaler globally except for its UK dealer group division, was looking to offload its 70 car and van showrooms in the UK, which employ some 3,700 people.
Inchcape’s board has now confirmed it has received interest from several potential acquirers of the dealer group, and it is considering its strategic options.
Its sale, should a deal be achieved, would be the latest in a string of takeovers involving top 10 AM100 dealer groups – US-based Lithia bought Pendragon’s dealerships plus Jardine Motors, US-owned Sytner bought Rybrook, Canada’s Global Auto Holdings bought Lookers and Constellation Automotive bought Marshall.
According to Sky News, Inchcape was working with Rothschild bankers to woo buyers, with analysts saying the retail division could be worth several hundred million pounds.
Inchcape statement said: “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.”
In the past decade Inchcape PLC has sold or ended many of its dealership ventures overseas and instead expanded its licenced distributorships in Asia-Pacfic and South America, whereby it manages the importing and wholesale of new vehicles for global vehicle manufacturers.
It sold its UK leasing division in 2019 to Toyota.
Its portfolio of UK dealerships is mostly focused on premium brands, including BMW, Mercedes-Benz, Jaguar Land Rover and Porsche.
Last March Inchcape chief executive Duncan Tait highlighted the success of the automotive PLC’s “portfolio shift towards distribution” as it reported a near-50% growth in profits in its 2022 annual financial results.
The risk of losing some £200 million annual turnover due to OEMs introducing agency contracts was highlighted by Tait, who made media headlines recently in Post Office scandal coverage for admitting he had described the Post Office’s Horizon system as Fort Knox when he was Fujitsu’s chief executive between 2011 and 2014.