LeasePlan has confirmed that talks are ongoing with a group of investors interested in buying the leasing giant for more than £2 billion.

The consortium is believed to include private-equity firm TDR Capital LLP, Dutch pension fund PGGM, the Abu Dhabi Investment Authority (ADIA) and the Government Investment Corporation of Singapore (GIC).

LeasePlan is owned by Global Mobility Holding, with Volkswagen AG and Fleet Investments each holding a 50% stake in the business.

LeasePlan confirmed the ‘investors’ are still in talks with Global Mobility Holding and these discussions “may or may not result in an agreement”

It said: “LeasePlan has been informed that the investors envisage financing the acquisition with an equity investment representing at least 40% of the total purchase price, cash-pay debt facilities of EUR 1,550 million ( £1.1bn) provided by an international syndicate of lenders and an additional source of funding that is currently under discussion.

It continued: “None of the debt raised by the investors would be borrowed by LeasePlan and the company would not be responsible for the repayment of such debt."

“According to the investors, it is expected that LeasePlan will maintain investment grade ratings allowing it continued access to the wholesale funding market directly.”

LeasePlan added that it would be giving no further comment at this stage.

A Volkswagen-led consortium bought LeasePlan from Dutch bank ABN Amro in a deal worth £1.4bn in 2004. Fleet Investments, which is owned by German banker Friedrich von Metzler, joined in 2009 after it acquired a 50% stake from two co-investors from Saudi Arabia and Abu Dhabi.

It has been a lucrative last five years for both partners, with LeasePlan almost doubling its net profit from €199m (£142m) in 2010 to €372m (£266m), last year.

During the past 50 years, it has grown to become one of the world’s leading providers of fleet management services. It is active in 32 countries, operates a global fleet of 1.42 million vehicles and employs more than 6,800 staff.

It also runs a small Dutch bank and, because of its Dutch banking licence, any deal will have to be approved by the Dutch central bank and financial markets authority.

Last year’s FN50 revealed the company’s risk fleet in the UK had grown to 100,575 cars and 39,123 vans. At the same time it grew its asset base by £150m and is predicting a risk fleet of around 145,000 by the end 2015.

It also expects to grow its funded fleet by 30% over the next six years which, based on last year’s FN50 figures, would take it past 180,000 vehicles.

However, to achieve that it recognises it will have to develop new products and services. Speaking to Fleet News before the story about the potential sale broke, UK managing director Matt Dyer said: “Finding new market segments, and products for those segments, is going to be crucial for LeasePlan’s success in the future.”

Currently, the UK business consists of four brands: LeasePlan, which caters for large corporates; LeasePlan Go aimed at fleets operating up to 100 vehicles; its public sector arm Automotive Leasing; and Network, its broker division.

 

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