Insurance group Aviva has announced that HBOS, its 50/50 joint venture partner in Lex Vehicle Leasing, has exercised an option under their joint agreement that will lead to Aviva's disposal of its stake in the business.

Aviva acquired the 50% stake in Lex as part of its acquisition of RAC earlier this year, and was aware of HBOS’s rights at the time the acquisition was made. This change of control triggered HBOS’s option.

Aviva and HBOS will now enter into discussions to agree a fair market value for Lex that may or may not lead to the sale of Aviva’s interest in the venture to HBOS.

Aviva’s sale of its stake in Lex will have no impact on the cost savings that the insurer stated it would achieve as a result of integrating the RAC business into Norwich Union.

Indeed, Aviva has confirmed that it will exceed the cost savings target of GBP80 million per annum forecast at the time of the acquisition and now expects to achieve savings of GBP100 million per annum in 2006.