Barclays agrees to sell vendor finance units to US firm
British bank Barclays said on Monday it had agreed to sell part of its vendor finance businesses in Britain and Germany to US commercial finance firm CIT for an undisclosed price.
By Agencies |
LONDON: British bank Barclays said on Monday it had agreed to sell part of its vendor finance businesses in Britain and Germany to US commercial finance firm CIT for an undisclosed price.
Barclays, Britain’s third-largest bank, said gross assets of the business to be sold were around £1.1bn ($2.1bn) at the end of June, about 12% of the gross assets of its asset and sales finance arm.
The business, part of Barclays’ specialist commercial asset finance provider, provides asset finance to customers of manufacturers and suppliers in industrial equipment and technology markets. Barclays finance director Naguib Kheraj said the sale would position the bank’s asset and sales finance arm for the future.
“Significant investment will be focused on its core asset and sales finance business including the ongoing expansion of its successful direct leasing business,” Kheraj said in a statement on Monday.
“The future strategy of the vendor finance businesses is now best pursued within a specialised leading global provider of asset finance solutions.”
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As part of the deal, CIT will take on vendor finance sales and administration staff in the UK and Germany, but Barclays will retain its controlling interest in Iveco Finance. The deal is expected to close at the end of ’06. Barclays shares were up 0.5% at 677-1/2 pence at 0833 GMT, while the DJ Stoxx European banking index was up 0.2 %. The Sunday Telegraph newspaper had reported that other bidders for the business included General Electric, Fortis and Societe Generale.
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