HG CAPITAL takes majority stake in LEASEDRIVE GROUP
Context
Private equity firm HgCapital has completed the acquisition of an 80% majority controlling stake in UK top-15 leasing firm Leasedrive. The transactional funding framework combines capital allocation from institutional investors in the HgCapital 6 fund alongside a contribution from the listed vehicle HgCapital Trust. Through this secondary buyout, previous institutional backer Lloyds Development Capital (LDC) will fully divest its majority interest held since 2008. For HgCapital, the investment functions as a strategic entry point to deploy a broader buy-and-build playbook aimed at sector consolidation within the UK vehicle management landscape. Leasedrive offers an attractive, defensive business model characterized by diversified revenue streams that provide economic downturn insulation. The post-closing commercial roadmap focuses on leveraging Leasedrive’s established white-label operations (including its fleet management partnership with Mercedes-Benz and its contract management portfolio with funding provider Investec) while actively pursuing downstream corporate acquisitions to scale the asset platform.
LEASEDRIVE GROUP, which reported an EBITDA margin of in 2013, is valued in this transaction at an EV/EBITDA multiple of , a level to compare with the average currently observed in the Financial Services sector (12.4x).
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Target
Leasedrive (formerly Leasedrive Velo) operates within the UK automotive services sector as a premier independent provider of vehicle leasing, fleet management, and contract hire solutions. Established in 1983 and headquartered in Berkshire, the company’s business model centers on commercial vehicle management, leveraging diversified, downturn-insulated revenue streams tailored for corporate clients. The platform’s core service architecture delivers integrated fleet outsourcing, lifecycle asset tracking, and dedicated third-party white-label fleet operations. The organization maintains a top-15 market position within the highly competitive UK fleet management landscape. Leasedrive's commercial strategy features high-profile corporate partnerships, notably managing the dedicated fleet business for automotive manufacturer Mercedes-Benz. Additionally, the company operates a substantial contract management portfolio on behalf of funding provider Investec, overseeing asset portfolios linked to Masterlease UK, which was fully integrated into the group in 2011.
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REFERENCES
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Acquirer: hg capital