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Equistone and SL Capital sell stake in specialist lender

03 Nov 2016

Equistone Partners Europe and SL Capital Partners have sold their stake in specialist lender Together (formerly Jerrold Holdings Limited) for c.£288m in addition to proceeds received during the life of the investment. The sale is to the founders of the business, which was established in 1974. 

Equistone invested £115.2m from Equistone Partners Europe Fund II for a 30 per cent stake in September 2006 and subsequently syndicated £20m to funds managed by SL Capital Partners. Both organisations have been supportive partners of the company since their initial investments.

Over the investment period, the Cheshire-headquartered company has delivered strong profitable performance, benefiting from the development of a highly capable management team which has been continually strengthened and supplemented by a high calibre non-executive Board.

The company, which offers short-term finance, auction finance, residential, commercial and buy-to-let mortgages and secured loans, saw its loan book grow by £377.2m in the year to the end of June 2016 and currently stands at more than £1.8bn – an increase of 26.5 per cent.

Steve O’Hare, partner at Equistone, said: “Together has demonstrated solid growth since our original investment and has built a quality management team who have sensibly invested in their operational, distribution and governance platforms and continue to apply a common sense approach to lending. This has been a great success story and we are pleased to have played a part in the company’s development. The business is in a strong position for further growth and I wish management every success for the future.”

Mike McTighe, group chairman at Together, said: “We are delighted to announce the successful issuance of £220 million PIK Toggle Notes to help facilitate the purchase of the minority interest stake held by private equity funds Equistone Partners and SL Capital Partners.

“Equistone Partners, who led the investment, have been supportive partners of Together for over 10 years and I would like to place on record our appreciation and thanks for their helpful guidance over a period of significant growth for the business.

“This announcement comes on the back of a successful issuance of £375 million Senior Secured Notes three weeks ago, demonstrating the strength of the Together business model and the solid demand from Note Investors to support the Company.

“As a business, which has been trading for over 42 years, we are going from strength to strength. In addition to our recent note issuances, we successfully upsized and extended a £1bn securitisation programme in March 2016, reported record pre-tax profits of £90.3 million for the year ended 30 June 2016 on a loan book value of £1.8 billion, and have underwritten over £1 billion of new originations over the same period in response to strong demand for our products and services.

“We have also recently undertaken significant investment in our operational loan processing platform and have made a number of high-profile new hires to further strengthen our customer proposition.”

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