Inchcape to sell U.K. retail business to Group 1 Automotive

British automotive distributor Inchcape has agreed to sell its U.K. retail operations to Group 1 Automotive for 346 million pounds ($431.43 million) in cash, following a strategic review it started earlier this year, the company said in a statement.

The company, which exports cars for global manufacturers across 40 countries, said it would use 100 million pounds of the sale proceeds to buy back shares once the deal is complete. That is currently expected to be during the third quarter of 2024.

Inchape's U.K. retail business has partnerships with brands including Audi, BMW, Volkswagen and Toyota.

The retail segment of the company contributes 10 percent to its total revenue, with functions only in the U.K. and Poland.

Last month, the company warned that demand in its key Americas market this year was likely to be towards historic lows, as high inflation and interest rates continue to strain household finances across the globe.

Group 1 Automotive, which was founded in the U.K., is a used and new car and van retailer, with official dealerships in East and South East of England.

Inchcape is Europe's sixth-largest dealership group by revenue, according to Automotive News Europe's 2022 Guide to Europe's biggest Dealers. It has 115 new-vehicle franchise points in the U.K.