Abu Dhabi Investment Authority involved in consortium with Singapore’s GIC and TDR Capital in the deal
Volkswagen and German bank Metzler have
sold financing company LeasePlan to a consortium of investors for 3.7 billion
euros ($4 billion), VW said on Thursday.
Europe's biggest carmaker has its own
in-house leasing business, VW Leasing GmbH, which made it harder to justify the
50 percent stake it has had in the third-party leasing business since 2004 amid
cost cuts and a refocusing of the group.
Volkswagen is aiming to make annual
savings of 5 billion euros by 2017 at its VW passenger car brand to close a
profitability gap with rivals such as Toyota.
Founded in 1963 and now the world's
largest lease fleet management company, LeasePlan operates in 32 countries, has
6,800 employees and manages 1.42 million vehicles. It made a net profit of 372
million euros in 2014.
LeasePlan said it expects the sale to a
consortium comprising Dutch and Danish pension funds, the sovereign wealth
funds of Singapore and Abu Dhabi, Goldman Sachs and private equity firm TDR
Capital to be concluded by the end of 2015, subject to approval from the Dutch
Central Bank and the European Central Bank.
The consortium will make an equity
investment of around half the purchase price, with the rest to be funded by a
480 million euro mandatory convertible note and a 1.5 billion euro debt
facility. LeasePlan will not be responsible for the debt.
Dutch pension fund manager PGGM said the
consortium wanted to support LeasePlan management's plans to expand, which
would remain an independent company.
People familiar with the matter had told
Reuters previously that VW was in advanced talks to sell the business for
roughly 3 billion euros.