Royal Bank of Scotland Insurance (RBSI) is to buy Tracker Network UK for between £80m and £100m.

The insurance group is thought to be interested in exploiting cross-selling opportunities and the chance to develop a pay-as-you-drive system.

Tracker is the UK's biggest stolen vehicle recovery company.

A market source said: "Tracker will give Royal Bank Insurance a head start in the race to develop a pay-as-you-drive system. They will also be able to tap into a huge database of high net worth drivers and use that information to cross-sell motor and other insurance policies."

Tracker was understood to have entered into negotiations with Norwich Union about partnering the insurer on its pay-as-you-drive system three years ago.

The move led to speculation that RBSI may be about to enter the same market.

Tracker was the subject of a £40m management buy-out backed by venture capitalists Apax Partners in 1999.

Ownership of Tracker's holding company Kickshaw's is shared between Apax (68%) and directors (32%)

Tracker, RBSI and Apax declined to comment.