From 31 January 2021 to 6 February 2021, the banking industry saw an increase in merges and acquisitions for a second week running, following three weeks of declining transactions.
There were 25 deals this week, when compared to the 24 deals the previous week. Amongst the 25 deals were 19 acquisitions, 3 mergers and 3 asset transactions.
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Most notably this week, was the acquisition by Metro Bank of a loan portfolio from Retail Money Market, a peer-to-peer lending company, for $526.12m in the UK on 2 February 2021.
The portfolio, which mainly consists of unsecured consumer loans, will continue to amortise between the announcement and expected closure date, meaning the exact amount is expected to be less. The transaction is expected to be complete in April 2021, following a two-month notice period for retail investors.
Daniel Frumkin, Metro Bank’s CEO, said: “The addition of this portfolio to our loan book is a further step towards growing our presence in the unsecured lending market. It builds on our acquisition of the RateSetter platform – a well-established business with a strong technology platform that is enabling us to rapidly expand our unsecured lending offering.
“We continue to deliver against Metro Bank’s strategic priority of optimising our balance sheet and asset mix, whilst positioning ourselves to better serve customer needs as the UK’s best community bank.”
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By GlobalDataOne day earlier, CURO Group Holdings Corp (CURO), a US-based provider of credit to non-prime consumers, announced plans to acquire 100% of Flexiti Financial Inc, a Canadian provider of point-of-sale and buy-now-pay-later consumer financing solutions for $121m.
The transaction has been approved by the board of directors of CURO and Flexiti Financial and is expected to close in the first quarter of 2021, subject to customary Canadian regulatory approvals. Houlihan Lokey served as financial advisor whilst Osler, Hoskin and Harcourt acted as legal counsel to CURO.
On 3 February, British wealth management firm Mattioli Woods acquired 100% stake in Montagu Limited for $3.19m on a cash-free, debt-free basis. The deal includes $1.92m in an initial cash consideration and contingent consideration of up to $1.32m payable in cash on the first and second anniversaries of completion. This is subject to revenue targets being met. Both companies involved in this transaction are based in the UK.
Commenting on the acquisition, Ian Mattioli, chief executive of Mattioli Woods, said: “Our discussions have confirmed the strong cultural fit and our common approach to looking after clients, and we are very pleased that the Montague team are joining Mattioli Woods.
“The transaction expands our existing operations in London and the South East. We believe the range of products and services that Mattioli Woods has to offer can support the excellent outcomes from which Montagu’s clients already benefit, whilst offering the potential to realise real revenue synergies by combining our operations.”
The transaction is expected to become effective on 8 February 2021.
