Element Financial Corporation and GE Capital announced that they have entered into a definitive asset purchase agreement, in which Element will acquire GE Capital’s Canadian fleet portfolio. The two companies will form a strategic alliance to deliver comprehensive vehicle fleet financing and management services to cross-border customers in Canada and the United States.
Under the terms of the agreement, Element will acquire GE Capital’s existing Canadian fleet portfolio for consideration of C$570 million subject to adjustments, along with the GE Capital Canada fleet operational resources required to service this portfolio. These Canadian operations will be combined with TLS Fleet Management, Element’s existing fleet management business.
In addition to serving the domestic Canadian fleet industry, the combined entity operating under the Element Fleet Management brand will serve Canadian customers under a strategic alliance agreement between Element and GE Capital Fleet Services. Through the long-term strategic alliance, the two companies will jointly pursue Canada/US cross-border fleet management opportunities.
“This alliance with GE Capital Fleet Services enables Element Fleet to bring more comprehensive fleet management technologies and solutions to our existing customers at the same time that it expands our addressable client base by giving us the capacity to deliver fleet management services to customers with needs on both sides of the Canada/US border,” said Steven K. Hudson, Element’s chairman and chief executive officer.
Kristi Webb, president and CEO of GE Capital Fleet Services added that: “This strategic alliance creates significant advantages for our GE Capital Fleet Services customers operating fleets in Canada. Our customers will enjoy a broader range of services, more geographic coverage and more feet on the ground in rapidly growing Canadian markets, and diversified capital funding sources to support their fleet needs.”
The Agreement provides for customary closing conditions, including approval under the Competition Act (Canada). Subject to the satisfaction of such conditions, the Acquisition Transaction is expected to close on or about June 28, 2013.