JUST 160 employees of IMO Car Wash Group shared a multimillion-pound profit yesterday after JP Morgan Partners, the private equity firm, agreed to buy the world’s largest car cleaning firm for £350 million.

Bret Holden, chief executive, gains the most from the sale, netting a paper profit of several million pounds on his 6 per cent stake in the group. All 160 staff at the company, which operates in Britain under the ARC brand, will retain their stakes in the company under JP Morgan’s ownership.

Mr Holden, 42, was recruited from British Petroleum in 1999 after Bridgepoint Capital, the private equity firm, acquired IMO for £114 million. In 2002 Bridgepoint bought Toman Group, a German car washing company, for £80 million and merged the companies.

Mr Holden, who will continue to run the company for its new owner, said yesterday there was plenty of scope to expand the business across Europe. Under Bridgepoint, IMO nearly doubled to 800 the number of car wash centres that it operates in 12 countries in Europe. The company tripled earnings before interest, tax, depreciation and amortisation to £40 million over the same period. Mr Holden said he planned to add 42 new sites this year rising to about 75 a year by 2008.

Stephen Welton, a partner at JP Morgan Partners, said: “We would look to spend between £30 million and £40 million a year to grow the company, both organically and through acquisitions. He said: “On the surface, IMO might seem like an odd sort of a company for a private equity firm to go into, but the buyout industry is so big now it is targeting virtually every sector.”

Mr Welton said that IMO was an ideal company for a private equity firm to buy because it generated regular income that could support a high level of debt.

IMO is just one of several deals that JP Morgan Partners, which manages about $21 billion (£12 billion) of assets, has been pursuing in recent weeks. The firm is understood to be interested in buying Saga, the holiday company that caters for the over 50s. It is also thought to be preparing an offer for Safety-Kleen, a tool cleaning business owned by Electra Partners, a rival private equity firm.

Mr Welton said: “(This year) has the potential to be a very good year for private equity generally. Companies are putting more unwanted units up for sale, interest rates are still low and banks are prepared to lend money for leveraged deals.”

The sale of IMO is Bridgepoint’s twelfth significant exit in the past year and represents a return of three times on the equity it invested in the buyout. Linklaters advised JP Morgan on the acquisition, Travers Smith Braithwaite worked with Bridgepoint and Druces & Attlee advised the company’s management. Bank of Scotland provided JP Morgan with debt financing.