Inchcape motors ahead with BMW acquisition

Inchcape, the upmarket car seller, became the UK's second biggest BMW retailer yesterday with the acquisition of six dealerships in the South of England.

The company said it now had the largest "contiguous" network of BMW dealers in the country, stretching from Tunbridge Wells in the east to Thames Ditton in the west. It bought the six BMW dealerships for £12m, in Banstead, Croydon, Sevenoaks, Tunbridge Wells, Cobham and Wimbledon. The network Inchcape now owns sold 3,500 new BMWs last year and 1,000 new Minis - 4 per cent of the marques' national sales volumes.

Inchcape has a number of other luxury brands, including Mercedes and Ferrari, and operates around the world. The company said it was looking to take these top brands to China. Reporting a 17 per cent rise in interim profits, Peter Johnson, the chief executive, said the company would be targeting China's "developing middle class".

Given the opportunities to expand globally, Mr Johnson said the company had decided not to return its £50m-plus cash pile to shareholders - though the dividend was increased 20 per cent. Of Inchcape's business areas, only Hong Kong performed poorly. Sales in the Sars-hit city were down 27 per cent in the first half of the year.