Bridgepoint Cancels 1st Credit Sale

Bridgepoint has scrapped the sale of 1st Credit in favour of continuing to expand the company.

It had put the debt collection business on the block earlier this year and received a number of offers but decided they were not high enough, falling below the Gbp350m Bridgepoint wanted, to proceed with the sale. Warburg Pincus, BC Partners and Bain Capital all submitted bids for 1st Credit reported the Financial Times.

Private equity has had a healthy appetite for debt purchase and collection businesses in recent years. Worsening consumer credit means more business for these companies. However, it is still a moot point whether increasing bad debt and a potential economic downturn make these assets more attractive.

In April, Exponent Private Equity has backed the secondary management buyout of debt purchasing company Lowell Holdings Ltd in a deal estimated to be worth between EUR 188m and EUR 251m.

Bridgepoint is now believed to be considering acquisitions of other debt collection agencies to add to 1st Credit.

Source: Thomson Merger News