A US car dealership giant is in advanced talks to buy Jardine Motors, one of the UK’s largest car retail groups, for around £300m.
Lithia Motors, which has a market capitalization of more than $6.5 billion on the New York Stock Exchange, is set to complete a deal to buy its UK counterpart within weeks, Sky News has learned.
One insider warned that the deal was still on the table and could fall apart.
If successfully completed, Jardine Motors will be sold by long-established Hong Kong-based conglomerate Jardine Matheson Holdings.
Jardines owns assets including the Mandarin Oriental hotel chain and Hongkong Land.
The acquisition would give Lithia a foothold in the UK, with access to luxury car brands including Ferrari and Maserati, the sources said.
They added that Lithia is committed to using the Jardine Motors business as a growth platform.
It would be the latest in a string of attempted deals in the industry, with Pendragon recently wrapping up talks on a takeover by its largest shareholder.
Lithia itself attempted to acquire Pendragon last year.
Other big names in the sector include Lookers, while major online rivals such as Cazoo have been hurt by a global tech sell-off.
Jardine Motors was acquired by Jardine Matheson in the early 1990’s as a single East Anglia dealership.
It employs around 2,700 people at 50 sites in the UK, according to its website.
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Brands sold at its dealerships include Ferrari, Jaguar, McLaren and Porsche.
Responding to inquiries from Sky News on Monday, a Lithia spokesman said: “Lithia has made it clear that it wants to enter the UK market and has held discussions with Jardine Matheson about investing in Jardine Motors Group UK.
“Jardine Motors Group UK is one of the UK’s leading automotive retailers and Lithia is convinced that the combination of the two companies will help create significant value for staff, partners and customers.
“Lithia sees the potential acquisition of Jardine Motors as a platform for future growth in the UK and plans to invest in the business, working with Jardine Motors’ market-leading management team to build on the strong momentum the group has generated in recent years.
“Discussions surrounding the potential transaction are ongoing and further updates will be issued in due course.”
Jardine Motors has yet to announce financial results for 2022, but expects revenue to rise 19% in 2021 with an operating profit of £28m.
A Jardine spokesman declined to comment.
It was unclear whether its London-listed parent company would also issue a statement confirming the talks.
Rothschild advised Jardine on the negotiations, while Deloitte advised Lithia.