(Alliance News) - Inchcape PLC on Monday confirmed it was reviewing options for its UK retail business, which could include a sale.
This followed approaches from a number of interested parties, the London-based automotive distributor said.
The statement followed a report by Sky News that said the company was "sounding out" possible bidders for the operation.
Sky reported that Rothschild bankers have been hired to oversee discussions as Inchcape "[sounds] out prospective buyers", with analysts suggesting that the business could fetch hundreds of millions of pounds.
According to sources, selling the UK dealerships would leave Inchcape free to concentrate on its higher-margin distribution activities.
These account for over 90% of gross profits, leaving the UK retail arm "relatively insignificant" by comparison.
Inchcape said the review was at a very early stage and there can be no certainty that it will result in a transaction.
Shares in Inchcape rose 0.5% to 687.00 pence in London on Monday afternoon.
By Jeremy Cutler, Alliance News reporter
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Inchcape (INCH)