Fast-food franchisee and car dealer Gowrings has agreed to sell two motor businesses, in Bracknell and Wokingham in the home counties, to the Inchcape group for £3.9 million to reduce borrowings, writes Robert Tyerman.

Fully-listed Gowrings, which combines the role of Ford dealer with being Burger King's second-largest UK franchisee, has been suffering from falling sales on the food side. Chief executive Derek Coulson recently warned that this area is facing 'very difficult trading conditions'. The proposed sale of two motor dealerships, subject to shareholders' approval later this month, follows a similar disposal of its Newbury motor dealership last month.

Last year, Bracknell and Wokingham made a combined operating profit of £800,000 – before tax, interest and central group management charges. Indeed, the whole motor side performed much better than Burger King, whose problems resulted in a 16 per cent full-year pre-tax profit fall for the whole group to £1 million, on £119 million turnover.

Gowrings is therefore disposing of some of its better businesses to help pay for problems at its worse performing division. The shares, which traded at around 120p in late 2000, today fell 4p to 88.5p.