Preliminary results - 12 months ended 31 December 2005
6. Operations classified as held for sale
The assets and liabilities of operations held for sale as at 31 December 2005 were as follows:
| 2005 £m |
2004 £m |
|
|---|---|---|
| Intangible assets | 9 | - |
| Investments and property and equipment | 320 | - |
| Receivables and other financial assets | 68 | - |
| Deferred acquisition costs and other assets | 40 | - |
| Cash and cash equivalents | 25 | - |
| Total assets | 462 | - |
| Payables and financial liabilities | (96) | - |
| Other liabilities | (49) | - |
| Total liabilities | (145) | - |
| Net assets | 317 | - |
In October 2005, the Group announced its decision to sell its 50% stake in Lex Vehicle Leasing (Holdings) Limited (LVL), a joint venture with HBOS, as a result of HBOS exercising an option under the JV shareholder’s agreement. LVL provides vehicle leasing, supply, management, maintenance and incident support for companies who outsource the day-to-day operations of their fleets, and was acquired as a part of the Group's acquisition of RAC. Completion of the sale of the investment in LVL is expected in the second quarter of 2006 and so the relevant assets and liabilities have been classified as held for sale in the consolidated balance sheet.
At year end, the Group held for sale certain divisions of Manufacturer Support Services (MSS), part of the RAC group. The decision to sell is part of the Group's wider strategy to integrate RAC and exit non-core operations. The divisions being sold primarily comprise Lex Transfleet Limited, Multipart Holdings Limited and Lex Commercials Limited, both wholly-owned subsidiaries, and Hyundai Car Finance Limited, an associate in which the Group holds 49.99%. Lex Transfleet is a provider of complex fleet solutions, Multipart Holdings provides logistics and aftermarket services to the automotive sector and Lex Commercials is a leading UK commercial vehicles dealership group, while Hyundai Car Finance Limited provides vehicle instalment finance and leasing. The disposal groups have also been treated as held for sale and are expected to be sold by the second quarter of 2006.
