Lloyds expected to sell HBOS investments

Lloyds Banking Group is preparing to launch a mega sale of stakes held by recent takeover target Halifax Bank of Scotland in some of Britain’s best-known companies, reports said today.

Shareholdings in more than 60 firms including cinema chain Vue Entertainment, gym group David Lloyd Leisure and D&D Restaurants, founded by Terence Conran, are reportedly being lined up for sale by Lloyds.

The part-nationalised bank has drafted in investment bank UBS to look at a potential sale of some or all of the investments, which were accumulated by HBOS for around £1.4bn (€1.6bn), according to The Sunday Telegraph.

Lloyds is 43% owned by the British taxpayer and is eyeing disposals to bolster its balance sheet after its rescue takeover of HBOS hit the group hard and landed it with hefty bad debts.

The bank is expected to launch an auction within months and may choose to sell assets individually or as a whole.

But it is not thought that Lloyds will rush into a firesale of the HBOS investment portfolio, which has already reportedly seen its value plunge to about £600m (€682m) amid the recession.

The bank declined to comment on plans for a sale of HBOS investments.