The City cheered car dealer Lookers as it picked up the keys to 30 more showrooms by snapping up privately-owned Benfield Motor Group for £87.5 million.
Benfield, founded in Newcastle-upon-Tyne in 1957, has 1,600 employees at showrooms across the North of England and one Volkswagen site in Dumfries. It reported pre-tax profits of £7m on revenues of £699.7m for 2014.
Lookers, which trades under the Taggarts and Lomond brands in Scotland, said the cash deal was funded by new banking facilities and is expected to provide an immediate boost to earnings.
Chief executive Andy Bruce said: "We are delighted to have acquired this respected and long established family business. A key attraction for us is the cultural fit.
"Both Lookers and Benfield share an approach which puts employees at the heart of our business and this acquisition will ensure that continues."
Lookers - founded in Manchester by John Looker in 1908 and originally a bicycle and parts shop - employed around 6,000 people at the end of last year. It already has more than 120 dealerships.
The firm, which also sells parts and servicing, includes Taggarts showrooms in Scotland and Charles Hurst in Northern Ireland.
Last month it reported a seventh successive year of improved earnings as half-year pre-tax profits rose six per cent to £39.9m.
Numis analyst Matthew Taylor said: "The acquisition of Benfield is a major step in Lookers' established and successful expansion strategy. The new company adds nearly 25 per cent to the group's scale... and dovetails nicely in terms of locations."
The broker raised its profit forecast for the full year by 12.5 per cent.
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