Inchcape plc (LSE:INCH) is exploring a sale of its UK retail business ? a deal that would herald another phase in the industry's ownership shake-up. Sky News has learnt that Inchcape has begun sounding out prospective buyers of its domestic operations in recent weeks.

Bankers at Rothschild have been hired to oversee talks with bidders, with analysts suggesting on January 29, 2024 that the UK retail arm would be valued at several hundred million pounds. The division consists of 70 sites, employing 3,700 people, and works with car manufacturers including Audi, BMW, Jaguar, Toyota and Volkswagen. Sources said on January 29, 2024 that the disposal of its UK dealerships would leave Inchcape free to focus on its higher-margin distribution activities in more than 40 countries around the world.

One added that shedding market perceptions of the company as a UK-focused car dealer should enable its board to attract a higher rating for its stock. However, one shareholder questioned whether that could ultimately lead Inchcape's board, chaired by former GKN boss Nigel Stein, to decide to move its listing to another international exchange. The company's shares have fallen by more than a quarter during the last year, leaving it with a market capitalisation of about £2.8 billion.

The pursuit of a deal will intensify investor scrutiny of Inchcape, which is led by chief executive Duncan Tait. An Inchcape spokesman said: "It is company policy never to comment on market rumours or speculation." Rothschild declined to comment.