Due for completion by the end of this month, the deal brings the company’s fleet total to more than 250,000 vehicles.
HBOS already owned 50% of Lex, which its Halifax division acquired as part of a joint venture with the RAC in 1998.
It has had the option of taking full control of the company since last year when the RAC was bought by insurance giant Aviva.
Since then, executives from Aviva and HBOS have been locked in talks to determine a ‘fair’ market value for the remaining 50% of the business, which has been put at £226.8 million.
Lindsay Town, managing director of Asset and Motor Finance at HBOS, said: ‘This acquisition gives us the opportunity to bring together Lex with our existing business, Bank of Scotland Vehicle Finance, into one combined operation. The scale of the business will enable us to deliver additional benefits for our customers, colleagues and shareholders.’
The new business will be run by Jon Walden, currently managing director of Lex Vehicle Leasing, which will retain its existing name and branding. He reports to Lindsay Town and will spend the next few months combining the two businesses.
Former Bank of Scotland Vehicle Finance managing director George Grant has been appointed Head of Motor Finance. He replaces Tom Woolgrove, who becomes managing director of HBOS General Insurance.
Commenting on his new role, for which he will lead a number of businesses, Grant said: ‘I look forward to bringing continuing success to our motor finance business.’