AutoNation rumoured to be staging UK return, eyeing Inchcape

US car dealer giant AutoNation is said to be eyeing a move to snap up Inchcape’s UK dealerships.

Sky News has reported that AutoNation is in the early stages of considering swooping on the listed Inchcape, one of a number of contenders mulling a potential acquisition.

The deal could be worth around £350m and would mark AutoNation’s first foray into the UK after walking away from a bidding war for Pendragon six months ago.

AutoNation, a listed automotove retail giant with a market capitalisation of almost $7bn (£5.5bn), posted revenues of $26.9bn (£21.3bn) last year.

In January, Inchcape confirmed it was potentially seeking a buyer for its UK operations which comprise 70 showrooms and 3,700 employees.

That prompted the company to issue a London Stock Exchange announcement, stating: “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.

At the time, Sky News reported that Rothschild had been hired to oversee talks with bidders and that a disposal of its UK dealerships would leave Inchcape free to focus on its higher-margin distribution activities outside the UK.

The deal would be the latest mega takeover of significant retailer groups in the UK. Last year, Lithia Motors acquired Jardine Motors, the UK-based company, from Hong Kong conglomerate Jardine Matheson Holdings. Lithia also agreed to buy the dealerships and leasing businesses of Pendragon while Lookers was sold to Canada’s Alpha Auto Group in a £465m deal.

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