Arrow Global to Acquire Rival UK Debt Buyer Capquest for $258 million

UK debt buyer and ARM firm Arrow Global Group said Wednesday that it is acquiring smaller rival Capquest from a private equity fund for £158 million ($258 million) on an enterprise value basis.

The agreement, which is subject to the approval of Arrow Global’s shareholders, brings together the two parties’ complementary expertise to form a larger, integrated group in which both brands will be retained. Capquest has a best in class in-house servicing platform and state-of-the-art collections system, which will be enhanced by Arrow Global’s leadership in data enhancement, analytics and supply chain management.

Arrow Global said that the combination with Capquest, which is owned by TowerBrook Capital Partners, will create a European debt purchase and collection business with £15.4 billion ($25 billion) in face value combined receivables under management by, £12.4 billion of which are owned. The deal combines Arrow Global’s 5.4 million owned customer account records with Capquest’s 2.8 million owned customer accounts.

Helen Ashton, Capquest Chief Executive, commented: “We are delighted to announce an agreement has been reached for Capquest to be acquired by Arrow Global. Our experience in regulated environments, strong reputation for compliance and commitment to socially-responsible practices, together with our understanding of our customers’ needs, makes Capquest an attractive partner for Arrow Global. I believe our combined businesses will create a strong company, well placed to prosper in the current environment.”

Tom Drury, Chief Executive Officer of Arrow Global commented: “Today’s announcement of the acquisition of Capquest reinforces Arrow Global’s position as one of Europe’s leading debt purchase and management businesses. The acquisition positions us well to enhance the quality of our offering to our customers and clients. Bringing together Capquest’s sophisticated and customer-focused in-house collection capabilities with Arrow Global’s master servicing model and leadership in data and analytics is an important step in achieving our vision of being Europe’s leading debt purchaser and manager. It adds a significant portfolio of assets at attractive returns, supports our broad range of origination sources and extends our reach into new asset classes.”