CONTRACT hire and leasing giant LeasePlan has been sold to a consortium led by Volkswagen as part of a global deal worth more than £1 billion.

The move, approved by the Volkswagen board last week, is part of a roadmap set out by Volkswagen to turn itself into a global mobility group.

ABN AMRO Bank, which stated several years ago it intended to dispose of its global leasing division, will sell it to a group in which Volkswagen Group holds a 50% share.

Two years ago, Fleet News revealed that Volkswagen was one of the leading companies in the bid to buy the leasing giant, which operates more than 120,000 vehicles in the UK.

Initial expectations of a sale were not met, but Volkswagen has teamed up with two co-investors, The Olayan Group and Mubadala Development Company, which have both taken a quarter share under the deal.

Mubadala Development Company is wholly owned by the Government of the Emirate of Abu Dhabi, while the The Olayan Group is a private, multi-national enterprise made of about 50 wholly-owned, joint venture and affiliated businesses, based in Saudi Arabia.

Although Volkswagen will be a major shareholder in the company, the firm insisted LeasePlan would retain complete independence as a multi-marque leasing company.

Volkswagen already has an own-brand leasing company, Volkswagen Financial Services (VWFS), along with rental firm Europcar Fleet Services (ECFS). ECFS and VWFS were listed in 24th place in the FN50 2003, with 10,237 vehicles, compared to LeasePlan, which was listed second with 126,138 vehicles.

Globally, LeasePlan Corporation is active in 26 countries, has over 7,000 employees and 1.2 million vehicles under management.

Kevin McNally, managing director of LeasePlan UK, said: 'Critically, our new partners understand our need for independence and respect our multi-brand business base.

'Externally, customers and suppliers will see few changes. Volkswagen has made it clear that the acquisition was not intended to create a new sales channel. As far as we are concerned it's business as usual.'

The acquisition is subject to regulatory approval, including the European Monopolies and Mergers Commission as well as the Dutch Central Bank.

Dr Bernd Pischetsrieder, CEO of Volkswagen Group, said: 'This acquisition is a decisive milestone for us and consistently follows our strategic roadmap to a global mobility group. Together with our partners we have acquired an extremely successful and profitable company.'

Volkswagen's plan already includes investment in financing, leasing, banking services, insurance brokerage and fleet management services.

Pischetsrieder added: 'With the multi-brand strategy we benefit in two ways. We will first of all directly benefit from the fleet management business, and secondly from the fact that our focus is now extended to the automobile market as a whole.'

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