Speculation is mounting that three bids from Inchcape, Lookers and Robert Tchenguiz, the millionaire property developer, have been tabled, valuing the company at between £300m
to £400m.
In a statement to the stock exchange, the top ten group, which did not name the interested parties, stressed that discussions were at a preliminary stage and there was no certainty that an offer would be made for the business.
As Motor Trader went to press, the EMH share price had shot up by 17 per cent from 404p to 475p following confirmation of the takeover talks.
The statement follows a period of intense speculation about the future of EMH after Goldman Sachs undertook a strategic review of the business in October.
The group is an attractive target for predatory rivals as it has maintained profitable growth in recent years despite tough market conditions.
The company recorded a sharp rise in pre-tax profit of 42 per cent to £10.2m in its interim results to 31 August, with turnover rising 27 per cent to £428m.
It also predominantly holds franchises in the prestige sector, including Audi, BMW and Jaguar, which is the main growth sector in UK car retailing.
Alongside the offers that have already been submitted it would not be a surprise if Pendragon entered the bidding.
The UK's largest dealer group remains highly acquisitive and last month raised nearly £240m from the sale and leaseback of 81 of its properties.
EMH currently operates 52 motor vehicle retail franchises from 46 sites across the UK.
Its group brand names include Dane, Gilbert Lawton, James Edwards, Malton Motors, Mill, Minster, Northfield and Smith Knight Fay.