Dutch newspaper names BNP Paribas’ Arval, BMW Financial
Services’ Alphabet, Volkswagen Financial Services, Rabobank’s
Athlon and GE Capital Solutions as potential buyers.
ING Group is negotiating the sale
of its ING Car Lease arm in a potential transaction that could
reportedly be worth €4bn.
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The Dutch bank confirmed the sale
of its vehicle leasing unit was a possible option and said it was
“reviewing strategic alternatives” for the division.
A spokesperson for the bank
stressed in a statement that negotiations may or may not lead to a
deal.
A statement was released in
response to a Dutch newspaper article, which said the bank had been
negotiating the sale for months.
The statement said: “ING
continuously evaluates and optimises its business portfolio, in
line with ING’s stated ‘Back to Basics’ objectives of sharpening
its focus and reducing complexity.
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By GlobalData“Within this context, ING today
confirmed it is currently reviewing strategic alternatives for ING
Car Lease, including discussions with third parties interested in a
potential acquisition.
“These deliberations may or may not
lead to a transaction. Any further announcement on this matter will
be made if and when appropriate.”
The statement said ING’s other
leasing businesses, including ING Lease and ING Commercial Finance
would not be affected by the sale of Car Lease.
Car Lease was not on a list of
assets marked for disposal as a European Commission condition of
the €10bn state bailout package the group received in 2008.
In June the bank agreed to sell its
US online bank to Capital One Financial Corp for $9bn
(€6.32bn).
The Dutch bank was the second major
bank in a week in discussions to sell its car leasing business
following the news RBS are selling Lombard Vehicle Management.
The article in newspaper Het
Financieele Dagblaad said the transaction could total €4bn as
a buyer would take over €3bn in debt and would need to inject
around €750m in capital as a balance sheet buffer.
The article also named several
leasing companies as having been invited to negotiations. These
include BNP Paribas’ Arval, BMW Financial Services’ Alphabet,
Volkswagen Financial Services, Rabobank’s Athlon and GE Capital
Solutions.
GE Capital was also mentioned in
connection with the RBS sale of Lombard Vehicle Management. A
spokesperson for Volkswagen FS told Leasing Life it was
not interested in the sale of ING Car Lease. A spokesperson for
Arval said no one was available to comment.
GE Capital also declined to
comment.
An industry source said the
business may suit sizeable providers or non-European providers
looking to enter the continent significantly with the necessary
infrastructure already in place.
These providers would look to grow
returns in the business by achieving economies of scale the source
said.
The reported equity cheque required
for the transaction may deter some of the smaller players, while
the debt amount and will certainly test financial market
appetite.
The source added Volkswagen and BMW
have used securitisations in the past and said this form of M&A
financing could be used in a potential Car Lease transaction, in
addition to a combination of bank and bond debt.
The reported size of the deal may
put off some of the smaller players and the required debt amount
and will certainly test financial market appetite.
ING would not comment on the sum mentioned only confirming the
unit has a fleet of 240,000 cars and employs 1,200 people across
eight European countries.
