Lowell Group, a purchaser of non-performing consumer debt portfolios in the United Kingdom, Thursday announced the acquisition of Interlaken Group. The deal, for an undisclosed sum, will include more than 300 Interlaken employees as well as Interlaken's Fredrickson International brand.
The move follows Lowell Group’s initial entry into contingency collections in January 2011 when it set up Lowell Preston (Tocatto) - designed as a research and development hub offering clients a chance to work with Lowell Group on a commission basis.
Its success demonstrated the size and potential of the opportunity to operate separate collection and debt purchase businesses under one umbrella company, providing the rationale for the Interlaken deal, Lowell Group officials said.
Lowell Group owns 10.8 million accounts while Interlaken Group manages 3.2 million accounts. The combined business will employ 950 people. Lowell Group plans to run its operations and the operations of the Interlaken Group separately, allowing each group to continue to develop its specialties and skills.
James Cornell, Lowell Group CEO, said, "Our move into contingent collections in 2011 helped us realize the potential of today’s deal; the opportunity to deliver best-in-class service to our clients whether it be through contingent collections or debt purchase. Through our partnership we will also be able to provide long-term value to our clients by delivering new, creative and innovative solutions beyond debt collection and debt purchase, and offer a ‘one-stop’ shop of services to drive operating profit and balance sheet objectives of our clients.
Cornell added that there are many opportunities for each business to expand into new areas as a result of the deal. Fredrickson International, for example, is highly skilled across all debt and balance types, while Lowell’s strengths traditionally have been in lower balance accounts and data analysis.
“Interlaken has a strong track record and 17-year history, but importantly we also have a shared belief about what makes our businesses strong – our people, practices and technologies. Not only are we an excellent fit culturally, both taking pride in family values, but we each bring a range of complementary skills and experience. The initial reaction from clients is supportive of our approach, which is hugely encouraging as we build and develop more strategic client relationships," Cornell said.
Simon Jones, managing director of Interlaken Group, and Roy Jones, chairman, founded Fredrickson International in 1992 and the Interlaken Group in 1996. Jones will remain with the business for a short term to help with the transition.
“Today is the end of an era. Roy and I are exceptionally proud of the company we have built together. Since we established the Interlaken Group 17 years ago we have gone from employing just a handful of people to over 300. We are delighted to pass the reins across to the Lowell Group. We hand them a company with a strong leadership team, talented and dedicated staff, an enviable client base, the highest standards of compliance and ethics and an exceptionally strong performance. We could not think of a better company to take our business forward and take it to the next level."
Deloitte and Osborne Clarke advised the parties on the transaction.