Ford Motor Company today announced the purchase of Warranty Holdings Group from Oman National Holding Company, a Middle East investment company.

News of the negotiations was revealed by Automotive Management on February 16. The purchase price was not disclosed.

George Weber, the Ford of Europe customer service executive who led the negotiations, said: "We regard the supply of extended warranties as a core competence. We considered four other businesses but selected Warranty Holdings because it is pan-European and the market leader."

Mr Weber said Warranty Holdings would be the European equivalent of Apco, a US warranty supplied acquired by Ford two years ago.

Warranty Holdings provides contracts for most manufacturers and many dealer groups.

Paul Muers, Ford of Europe project manager on the deal, said: "We are keen to maintain a warranties relationship with other manufacturers but it will be a challenge."

General Motors owns Car Care Plan, one of Warranty Holdings' main rivals.

Peter Head, Warranty Holdings chief executive, will continue as head of his company as did Sir Tom Farmer when Ford bought Kwik-Fit.

"We are having discussions with our customers other than Ford and I am confident we can keep them," he said. Bill Connelly, Ford of Europe customer service division vice president, said: "The acquisition is closely aligned with Ford's goal to become the world's leading consumer company providing automotive products and services."