Automotive distributor Inchcape has agreed the sale of its UK retail operations for £346m.
The business operates dealership franchises for brands including Audi, BMW, Jaguar, Land Rover, Mercedes-Benz, Toyota and Volkswagen. It employ around 3,600 people at over 80 sites across the UK, with 12 OEM partners.
In 2023, Inchcape’s UK retail operations generated revenue of £2.07bn, 18% of group revenue, and adjusted operating profit of £49m, representing 7% of group operating profit.
The sale agreement with Group 1 Automotive UK Limited, a subsidiary of Group 1 Automotive Inc, follows a review of strategic options announced in January 2024. Inchcape intends to focus on its higher margin distribution operations, which include product planning and pricing, import and logistics, channel management and aftersales.
Group 1 represents 15 OEM brands and has operated in the UK since 2007.
Following completion of the transaction, Inchcape plans to return £100m of the proceeds to shareholders through a share buyback programme. The remaining proceeds will be used to invest in future growth, including potential acquisitions.
Subject to regulatory approval from the Financial Conduct Authority, the sale is expected to be completed in the third quarter of 2024.
