Hornby, the Kent-based models and collectibles group, has taken over an iconic name in model cars. The Thanet company famous for its model railways, Scalextric slot car racing cars, Airfix models and Humbrol paints, is the new owner of Corgi, the famous die-cast model business.

In a £7.5m deal, Hornby has bought the brand, tooling, and intellectual property rights from Corgi International, a company quoted on the United States NASDAQ share index. Hornby says it intends to grow the brand and says marketing, sales and development staff will be retained.

Corgi, which had sales of £6.5m last year, is one of the oldest manufacturers of collectible die-cast models of trucks, buses, cars and aeroplanes in the world.

Corgi’s famous model vehicles captured the imagination of millions of baby boomers and are now highly sought-after in the expanding collectibles market. Its main markts are the UK, the US and Northern Europe.

Hornby’s chief executive Frank Martin said: "The strategic fit with our existing businesses could not be better. We are confident that we will grow the scale of the business rapidly and drive it forward."

He added: "We have set in place a detailed integration plan to ensure that we improve Corgi’s performance rapidly. We will focus on product innovation, improving the distribution network and driving sales growth both in the UK and internationally.

"This acquisition is an extension of the Group’s strategy to build an international hobby and collectibles business with a broad range of brands. Looking to the future, we are extremely excited by the potential growth that Corgi can deliver."

Corgi was established by the Mettoy Company in Northampton, which first started to produce pressed metal toys in the 1930s. The Corgi brand for die-cast models was born in 1956 and at its height, was selling millions of toys a year, including the Batmobile, the Lotus John Player Special Formula 1 car and James Bond.s iconic Aston Martin DB5. More recently, production has been moved to lower cost plants in the Far East.

As part of the Corgi deal, Hornby is also acquiring Bassett-Lowke, an upmarket "O" gauge model railway brand.