Arrow Global splashes out €82m on Italian job
Arrow Global Group, the Manchester-based purchaser and manager of debt, has acquired two Italian acquisitions for a total of €82m (£72m), reinforcing its growing presence in the country.
The first is for Europa Investimenti S.p.A., a leading originator and manager of Italian distressed debt investments, for an equity value of €62m.
While the core Europa business is not regulated, due to Europa owning a 74% stake in an Italian real estate fund management company, Vegagest SGR S.p.A., the transaction is subject to a regulatory change of control approval by the Bank of Italy and is expected to complete in mid-2018.
The second is for 100% of Parr Credit S.r.l., a Rome-based servicer of Italian non-performing loans (NPL) for an equity value of €20m. There are no regulatory approvals required for the transaction and the acquisition will complete today (Thursday, March 1).
The acquisitions will be funded in cash from existing group resources and are expected to be broadly earnings neutral in 2018 and marginally accretive in 2019.
Arrow Global’s group chief executive Lee Rochford said: “Both (acquisitions) build on the successful 2017 acquisition of Zenith and give us valuable Italian primary and special servicing capabilities that support our growth ambitions.
“Europa augments our capital-light asset management capabilities, with clear opportunities to offer this across our existing client base.
“The group has completed a number of co-investments with Stefano Bennati and the Europa team, and we have been impressed with their expertise and ability to generate investment volume for the group and its partners.
“Having looked at a number of acquisition opportunities in Italy, we have been very impressed with Parr’s long-standing customer relationships, deep collections expertise and proven migration capabilities. We see clear opportunities to offer Parr services across our existing client base.
“These acquisitions deepen our commitment to Italy, Europe’s largest NPL market. With our leading positions in the UK, Portugal, the Netherlands and our recent entry into Ireland we continue to see the benefits of geographic diversification. There remain opportunities for growth across the European marketplace.
“We are excited by these opportunities and we look forward to welcoming the Europa and Parr teams into the group.”
The announcement of the acquisitions was timed to coincide with Arrow Global’s preliminary results for the year to December 31, which show its turnover rose 19.7% to £347.2m and its post-tax profits climbed 24.1% to 56.6m.
