March 26, 2018 / 7:40 AM / 2 years ago

UK's Inchcape to buy Central American car dealership business

(Reuters) - British car dealership chain Inchcape Plc (INCH.L) said on Monday it would buy family-run Grupo Rudelman, an automotive distribution business in Central America, as it looked to strengthen its presence in the emerging markets.

Inchcape, which trades in more than two dozen countries, will pay Grupo Rudelman’s shareholders $284 million, gaining access to the Suzuki-led distribution business in Costa Rica and Panama, the UK firm said in a statement.

Costa Rica and Panama present structural growth opportunities, given their low vehicle penetration rates and economic growth expectations, Inchcape said.

The deal comes nearly a month after Inchcape reported an over 38 percent rise in annual pretax profit, helped in part by a strong performance in Asia and emerging markets.

Inchcape said the acquisition of Grupo Rudelman, which sold 12,500 new Suzuki vehicles in 2017, would add to earnings in the first full year post-acquisition by mid-single digits in percentage terms.

The cash-free and debt-free basis deal will also improve Inchcape’s operating margin, it said.

Inchcape shares were up 1.2 percent at 680 pence as of 0811 GMT on the London Stock Exchange.

Reporting by Rahul B in Bengaluru; Editing by Amrutha Gayathri

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