Transaction expected to
close in Q4, subject to regulatory approvals. Fred Crawley
reports.
Go deeper with GlobalData
Alphabet
International has bought ING Car Lease for €637m (£563m), subject
to regulatory approval.
The transaction is expected
to close in the fourth quarter of 2011, and the price is far below
the €4bn reported earlier this month when the news of the sale by
ING was leaked by a Dutch newspaper.
Motor Finance
believes this figure represented an estimate of the ING Car Lease
balance sheet – which it is understood may be closer to
€3.5bn.
The acquisition will give
Alphabet a presence in 16 European countries, adding Poland and
Luxembourg to its current roster, and nearly double the company’s
total fleet.
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By GlobalDataThe combined fleet of ING Car
Lease and Alphabet in the UK will stand at around 95,000 vehicles,
making it the third largest in the UK.
Alphabet International head
Norbert van den Eijnden said: “In the growing European fleet
management market, ING Car Lease is the perfect fit to complement
the activities of Alphabet. Alphabet will increase the number of
company car contracts under management to approximately 540,000 and
thus consolidate its competitive lead in the European fleet
management market.”
Van de Eijnden added the
acquisition will see Alphabet concentrating on the growing
full-service fleet management sector.
When the deal is complete
Alphabet will assume control of ING Car Lease’s fleet of 240,000
cars and 1,200 employees across eight European
countries.
A spokesperson for BMW would
not be drawn on the future structure of the combined businesses
before the deal was formally closed, but said: “What we can say is,
we are happy to keep every employee as our intention is to
grow.
“It is not simply a question
of synergy and reducing headcount.”
ING said the deal will result
in total proceeds of €700m, a combination of the base purchase
price plus estimated earnings until the deal is closed.
ING Group CEO Jan Hommen
said: “The sale of ING Car Lease illustrates ING’s continued
actions to streamline our business and simplify the
company.
“Going forward ING will
continue to build on its leadership position as a predominantly
European Bank with a strong international network focused on
providing its customers with consistent high-quality
services.”
ING’s other leasing and
factoring businesses, including ING Lease and ING Commercial
Finance, are not affected by today’s announcement.
ING said the purchase price
of €637m is based on 2010 year-end book value and the bank will
gain €335m in sale profit and €530m in capital release from the
transaction. The capital release will add 17 basis points to core
Tier 1 ratio.
The sale of Car Lease is the second disposal of a non-core
business from ING, which received a state bailout of €10bn in 2008,
following the sale of its US online bank to Capital One Financial
Corp for $9bn (£5.6bn) last month.
