Audi has sold Cosworth Technology, the Northamptonshire-based engine-maker, to automotive German parts manufacturer Mahle for an undisclosed price.

Audi paid £117m for Cosworth when it bought the business from Vickers in 1998, but at that time it included the Cosworth Formula 1 racing engines business which was subsequently sold to Ford.

An Audi spokesman said his company would continue to use Cosworth's services but had taken the decision to sell to allow the British firm greater opportunity to bid for contracts from rival car manufacturers.

The deal takes effect at the turn of the year, pending regulatory approval.

Mahle makes pistons, engine components and filter systems.