Alantra advises Secure Trust Bank PLC on its exit from the UK debt purchase market

May 2022

Sell-side advisory

Value £94 million

Alantra, the global investment banking and asset management specialist, is pleased to announce that it has advised Secure Trust Bank PLC (STB), a listed UK retail bank, on its exit from the debt purchase market via agreements between Debt Managers Limited (DMS), STB’s debt purchasing subsidiary, with Intrum UK Finance Limited involving: (i) the sale of DMS’s loan portfolio, (ii) a forward flow agreement to sell future consumer and vehicle loans of STB to Intrum and (iii) the transfer of DMS’s employees to Intrum post portfolio migration. The gross value of the portfolio as of 30 September 2021 was £84.7 million and it comprised around 650,000 customer loans. The value of the consideration for the portfolio as of 30 September 2021 was £94.0 million.

Alantra was engaged to assist STB to exit the debt purchase market in a value accretive manner. The mandate targeted value accretion and unlocking capital for redeployment to the bank’s core segments, while enabling continuity of the bank’s forward flow arrangements. Drawing on the M&A and Credit M&A expertise and the relationships with market participants across the debt purchasing, loan servicing and platform carve-out space in the UK and Europe, Alantra structured a competitive two-stage process targeting strategic buyers, which concluded in a transaction with Intrum that delivered STB’s objectives.

David McCreadie, Chief Executive Officer of Secure Trust Bank, commented: “The sale is in line with STB’s strategy to simplify the Group and to focus on our specialist lending businesses that have the strongest prospects for delivering sustainable and profitable medium to long-term growth. Within these businesses, our key priority is to help more customers extend our product offerings and further enhance our digital capabilities. The estimated net benefit and capital released in FY2022 from this sale will facilitate swifter progress in these areas. I would like to thank Alantra for helping us achieve this transaction.”

Roberto Marantidis, Managing Director at Alantra, noted: “We are proud to have assisted Secure Trust Bank in achieving the transaction. Alantra’s market leading knowledge of the UK and European debt purchase market and its key participants allowed for a highly focused and effective process. This, combined with our firm’s deep experience in structuring and executing both M&A and Credit M&A transactions, allowed us to deliver STB’s objectives in a tight execution timetable, achieving both a capital releasing and P&L accretive outcome for the bank”.

Eddie Nott, Intrum’s Managing Director for the UK and Ireland, said: “We are delighted that Secure Trust Bank sees Intrum as the right custodian for its DMS portfolio”. “We appreciated the way Alantra managed the process and the constructive approach taken when engaging with us”, added Stan Kasnodeskyi, M&A Director at Intrum.