08:40 Tom Daldry, Shard Financial Media
Credit management services provider Lowell Group today (April 13) announced its acquisition of debt resolution firm Hoist UK, in a deal valued at £370 million.
Senior journalist, covering the Credit Strategy and FSE News brands.
The acquisition includes the operations of Hoist Finance UK and its entire unsecured non-performing loan portfolio, comprising more than two million consumer accounts almost exclusively in the credit card and personal loan sector.
As of December 2021, there was approximately £585 million over 180 months of Estimated Remaining Collections (ERC).
The transaction value of £370m is based on enterprise value as of December 31, 2021, representing £340m of net debt.
The move continues Lowell’s strategic expansion into the UK financial services sector, particularly banking. It will provide Lowell with access to a better understanding of financial services market data, resulting in faster pricing and analysis while reducing investment risk.
Completion is subject to Financial Conduct Authority (FCA) approval, which is expected in the third quarter of 2022. Lowell said it plans to keep leverage within its guided range of 3.5 to 4 .0x at the end of the transaction.
Lowell also announced the issuance of the first European ABS Rated Loan.
The new securitisation, through Wolf Receivables Financing PLC, includes 357,000 recurring customer accounts with approximately £180m of ERC over 120 months.
Lowell said its acquisition of Hoist Finance UK will be funded by a combination of proceeds from the new securitisation, strong operating cash flow and existing funding sources.
Jamie Wilson, Lowell’s Chief Financial Officer, said, “These two transactions meet our stated goals of continuing to grow our business and diversify our revenue and balance sheet.”