ALD has signed a memorandum of understanding to acquire fellow leasing company Leaseplan.

The proposed 4.9 billion Euro deal is due to be completed by the end of 2022, and is set to see the companies join together under the name NewALD.

NewALD is set to target long-term fleet growth of at least 6% per annum once the deal is completed, and a cost-to-income ratio improvement of around 45% by 2025.

ALD CEO Tim Albertsen said: “Today marks the beginning of a new chapter in our history as a first step towards creating NewALD. In the context of today’s transformation of the automotive and mobility sectors, which is proceeding at an unprecedented pace, this proposed transaction is instrumental in the creation of a leading global player in mobility. 

“By combining the multiple strengths of ALD and Leaseplan, gaining size, joining forces in digital and creating a leading provider of sustainable mobility solutions, we would transform our industry and be best positioned to deliver even better solutions and value propositions to our enlarged client base. 

“This transaction would create multiple opportunities to the joint management teams and talents of both companies, across geographies, underpin our focus on sustainability with a clear path to zero emissions mobility and not least deliver strong shareholder returns over the cycles. We are all very excited about the prospect of being part of this new venture.”

Leaseplan CEO Tex Gunning said: “The combined business would be instrumental in moving the automotive industry from ownership to subscription models and zero-emission mobility. 

“By joining forces with ALD, we combine the best talents in the industry with the investment power needed to meet the next generation mobility needs of our customers. From day one, NewALD would be operating one of the largest fleets of electric vehicles and will continue to set the standard for ESG in the mobility industry. 

“I am very proud of all ‘Leaseplanners’ for bringing our business to where it is today. We are looking forward to working with the excellent team at ALD and taking our combined business into the exciting future of mobility.”