Debt buyer Encore Capital Group is acquiring a controlling stake in United Kingdom and Ireland-based Cabot Credit Management (CCM) for an estimated $192 million.

Encore, based in San Diego, buys delinquent accounts from banks, credit unions and utilities and has long sought ways to take advantage of growth opportunities in the U.K., the largest debt purchase market in the world after the United States.

The partnership will give CCM access to more capital and allow the company to expand into other asset categories, according to a company news release.  

Cabot is "well positioned" to bid on distressed consumer loans that are likely to come to market in the U.K. over the coming years as banks look to get rid of them, said Encore President Ken Vecchione, who will become CEO in June.

Encore is buying a 50.1% interest in CCM and has the option to buy the rest of the company from private equity firm J.C. Flowers & Co. LLC four to six years after its initial purchase. The deal is targeted to close in the third quarter.

AnaCap Financial Partners announced just two weeks ago that it had sold CCM to J.C. Flowers.

"The combination of Encore and Cabot Credit Management creates a global leader in the consumer debt purchase and recoveries industry," added Vecchione. "Encore has been looking for a strong partner in the U.K. for several years – one that is a leader, has a strong management team and has the ability to leverage our analytic capabilities and efficient operating platform. We've found all of this in Cabot Credit Management."

Encore has been growing by buying loan portfolios from competitors, with two large transactions last year. In March Encore announced it was buying competitor, Asset Acceptance, for an estimated $200 million.

Cabot had revenue of approximately $260 million last year. It has purchased 3.5 million consumer accounts.

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