Lombard Vehicle Management is to close as a result of parent company Royal Bank of Scotland’s restructuring.
ALD Automotive has signed a five-year agreement to take over the company’s contract hire and fleet management, which will come into effect in around June or July.
A spokesman for RBS said: “Having to cut jobs is the most difficult part of our work to rebuild RBS.
“The decision to close Lombard Vehicle Management was a difficult one but is a necessary step in our plan to de-risk and re-focus RBS, making the bank safer and stronger.
“We will do all we can to support our staff, offer redeployment opportunities wherever possible, and keep compulsory redundancies to an absolute minimum.”
LVM, which has a fleet of around 58,000, has been up for sale since the financial crisis reached its peak in 2009.
It was claimed that the business was not especially profitable due to its price-led nature, which would explain why RBS failed to find a buyer, despite previous interest from GE Capital.
ALD is anticipating in excess of 30,000 new vehicle contracts over the next five years as a result but the branding of the new operation has yet to be announced.
Keith Allen, ALD’s managing director, said: “We’re delighted that RBS and Lombard have chosen ALD to provide contract hire and fleet management solutions for Lombard.
“The new proposition will have access to all the vehicle leasing business generated through RBS banking and Lombard relationships, reinforcing the success of the multi-sales channel strategy we have adopted to grow our business and driving the business further forward to become a top three player within the UK leasing industry.”
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