Inchcape in Talks to Buy Car Dealer

Inchcape, the British-based chain of global car dealerships, said Monday it was in exclusive talks to acquire Musa Motors, a Moscow auto retailer.

The discussions are at an "early stage," Inchcape said in a statement. The acquisition would be funded by existing debt facilities, the company said.

Inchcape is expanding into Russia amid declining demand in more mature markets. The car dealer has purchased two outlets in St. Petersburg in recent months and disposed of British sites for about ?37 million ($72 million).

Musa may be worth as much as $450 million, according to Kommersant. The company sells brands including Jaguar, Land Rover, Volvo and Jeep.

Inchcape advanced 13.75 pence, or 3.8 percent, to 372.25 pence in London, giving Inchcape a market value of ?1.71 billion. The stock has declined 30 percent in a year.

The British company operates in 26 countries and plans to expand in Russia and China. Inchcape generates about 4 percent of sales from emerging markets, it said in October. The value of the Russian car market doubled to $44.6 billion between 2005 and 2007, led by the sale of foreign-brand cars, Inchcape said in a presentation on its web site.