Cattles Invoice Finance up for sale

CATTLES, the quoted financial services group, is said to be looking for a buyer for its Cattles Invoice Finance subsidiary.

The group refused to comment on the potential sale but TheBusinessDesk.com understands Ernst & Young has been appointed to find a buyer.

A source close to Cattles said the group expected to complete a sale by the end of the year for more than £100m, a figure that reflects the value of the business’s loan book.

Interest is expected from private equity houses, foreign banks and existing players in the market such as GE Commercial Finance.

The division, which operates nationwide and has offices in Manchester and Liverpool, typically lends to businesses with a turnover of less than £20m.

Batley-based Cattles, which specialises in lending to those on low incomes, is keen to focus on the personal finance market. It is concentrating on its application for a banking licence and believes it can raise deposits worth £1bn  by 2010.

In the six months to June 30 Cattles Invoice Finance saw pre-tax profits slip £400,000 to £1m because of an increased loan loss charge of £1.2m against three accounts from last year.

It increased its income in the first half of the year by 15.8% to £9m with the value of invoices factored rising 8.2% to £480.6m.

The business was formed in 2001 from two Cattles acquisitions, Reedham Factors and Argent Commercial Services.

Ernst & Young declined to comment.