Japanese mull £650m Kwik Fit bid

A MAJOR Japanese trading house is reportedly preparing a bid for Kwik Fit, the car service chain founded in the 1970s by Scots entrepreneur Sir Tom Farmer.

Marubeni - which employs 29,000 people around the world in sectors as diverse as food, textiles, energy and chemicals - is expected to take part in the 650 million auction for the business, which is being sold by French private equity owner PAI.

Credit Suisse was hired last month to lead the sale of Kwik Fit after PAI received a number of offers for the business, believed to have been from tyre makers Bridgestone and Michelin, which owns the ATS Euromaster garage chain in the UK.

Kwik Fit's underlying profits fell by 1.5 per cent to 98.4m last year after margins at its fixed-price car fleet business were squeezed.

Marubeni already operates a network of 24 car showrooms in the UK and is one of the largest dealers in Japanese brands Toyota and Mazda in Europe.

The giant trading company - which was founded in 1858 and is listed on the Tokyo stock exchange - reportedly walked away from exclusive talks to buy tyre wholesaler Micheldever from Graphite Capital, its owner.

Marubeni did not return calls for comment yesterday.

A spokesman for PAI said: "It is early days in the sales process.

"PAI is not in advanced talks with Marubeni or anyone else."

Farmer founded Kwik Fit in 1971 and went on to sell it to Ford in 1999 for 1 billion. The American car heavyweight later sold it to private equity firm CVC, which in turn took 800m from PAI for the business in 2005.

PAI sold the Uddingston-based Kwik Fit Insurance arm to Belgian finance firm Ageas, formerly Fortis, last year for 215m.