Pepper Group Announces Acquisition of Oakwood Loan Servicing & Asset Management Platform

Posted 11-09-2013

Australian specialist financial services group, Pepper Australia Pty Limited (“Pepper”) has today announced that it has acquired 100% of the issued share capital of Oakwood Global Finance LLP and its controlled entities (“Oakwood”). Pepper has purchased the business from private equity investor, Pamplona Capital Management LLP, and a small group of individual investors comprising current and former members of the Oakwood management team led by Richard Klemmer and Laurence Morey.

Oakwood is an innovative financial services company that specialises in valuing, trading and managing portfolios of financial assets, primarily performing and non-performing residential and commercial mortgages, which are exposed to real estate and credit risk. It is also the premier, independent loan servicing and asset management platform in the United Kingdom, offering clients a full range of in-house credit and asset management services including Loan Origination, Primary Servicing, Master Servicing and Special Servicing.

The Company is one of the highest rated independent residential mortgage Special Servicers in the United Kingdom, holds Primary Servicer ratings for both prime and subprime mortgages, and is also a Fitch rated residential mortgage Master Servicer.

Announcing the deal in London, Pepper’s Group Managing Director & CEO, Patrick Tuttle said: “Oakwood is the UK’s leading specialist loan servicing and asset management platform. Its track record in managing both performing and non-performing residential and commercial mortgage portfolios is second-to-none, and the management team led by Richard Klemmer is among the best in the UK market”.

From a strategic perspective, this deal further expands Pepper’s European loan servicing platform and capabilities across three jurisdictions, including Ireland, Spain and the United Kingdom. This is in addition to Pepper’s home market of Australia where it is already one of the largest non-bank financial institutions, as measured by total assets under management.

Michael Culhane, Pepper’s Executive Chairman added, “This acquisition further extends Pepper’s servicing-led strategy to acquire high quality loan servicing platforms led by high calibre management teams in our targeted European markets, including Ireland, Spain, the United Kingdom and Italy. As the founder of both Oakwood and Pepper, I am delighted to see these two great businesses joining forces in Europe; I think we will make a formidable combination”.

The London-based Oakwood, which commenced operations in 2002, currently manages a diverse range of loan portfolios on behalf of banking and institutional clients with combined assets under management in excess of A$4.4 Billion. Its main servicing operation is located on Cromwell Road, London and houses approximately 130 permanent staff and a state-of-the-art loan administration and asset management platform.

Patrick Tuttle further commented: “Pepper can now truly claim to be a pan-European loan servicer and asset manager across multiple asset classes and operating in multiple jurisdictions. We are fiercely independent and offer professional investors unrivalled expertise in managing both performing and non-performing loan assets adversely impacted by volatile macroeconomic conditions across Europe”.

For further information please contact:

Ben Valdimarsson
ReputationInc
Tel: +353 (0)1 412 0500
Mob: +353 (0)86 173 5123

Sinead Moore
ReputationInc
Tel: +353 (0)1 412 0500
Mob: +353 86 375 1004

Sydney

Natalie Cameron / Michael Henderson
DEC Public Relations for Pepper Australia
02 8014 5035 / (02) 8014 5033
pepper@decpr.com.au

 London

ReputationInc Public Relations for Pepper Europe

Ben Pendlebury
Tel: +44 (0)207 024 2629
Mobile: +44 (0)7714 901 477

Gauri Mahtani
Tel: +44 (0)207 024 2612
Mobile: +44 (0)7532 071 304

Notes to editors:

Pepper Australia Pty Limited (“Pepper”) is a highly experienced specialty mortgage lender, third-party loan servicer, and asset manager. Our underwriting philosophy, credit, loan servicing, collections and asset recovery procedures have been developed on the basis of more than 19 years of specialist mortgage lending experience, tried and tested in the United Kingdom and Australia.

About Pepper – Key Facts

  • Pepper Group (“Pepper”) is Australia’s largest non-bank residential mortgage lender (as measured by total assets under management), a leading provider of specialty residential mortgage and consumer financing and a highly experienced third-party loan servicer and asset manager.
  • Worldwide, with the recently announced Oakwood transaction the company currently has approximately A$13.5 billion of loan and lease assets under management (comprising residential mortgages, commercial mortgages, equipment leases, small business loans, unsecured consumer loans and car loans).
  • Since establishing itself as a specialist residential mortgage lender in the Australian market in March 2001, Pepper has originated more than A$4.0 billion of specialist residential mortgages in Australia.
  • In 2011 Pepper acquired GE Capital’s Australian and New Zealand mortgage lending businesses, which comprised a portfolio of approximately A$5.0 billion of Australian and New Zealand residential mortgages. This transaction was one of the largest whole loan transactions in Australian history.
  • In June 2012, Pepper established Pepper Asset Servicing in Ireland, having acquired the Irish mortgage business of GE Capital which included 3,500 Irish mortgage accounts and €650 million in receivables. At the time the company also assumed responsibility for the servicing of GE Capital’s Irish portfolio of personal, small enterprise and auto loans. Since then the company has invested significantly in the Irish operation and recently announced it had been appointed by CarVal Investors to provide special servicing, master servicing and asset management on the €380 million Pittsburgh portfolio of loans CarVal Investors acquired from Lloyds in December 2012.
  • More recently the Irish business has been awarded servicing mandates from Danske Bank and the Irish government to manage pools of residential and commercial mortgage assets.
  • In July 2012, Pepper acquired Grant Samuel Holdings Limited real estate advisory business, which was renamed Pepper Property. Pepper Property is a leading real estate investment and advisory group that delivers independent, high quality strategic advice to the corporate real estate (CRE) sector, tenant representation services, capital structuring, divestments and acquisitions, and investment management services.
  • In March 2013, Pepper established Pepper Spain in Madrid having acquired the Celeris servicing and origination platform from shareholders consisting of a number of Spanish banks and building societies. Along with the platform of 122 people Pepper acquired a €290 million personal loan portfolio.
  • Pepper’s current wholesale funding partners in Australia include Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corporation.
  • In addition to lending and servicing its own mortgage portfolio, Pepper provides third party servicing of various types of mortgages, leases and unsecured loan products.
  • Pepper is jointly led by Executive Chairman, Mike Culhane, and Group Managing Director & CEO, Patrick Tuttle. Mike and Patrick are focused on ensuring Pepper continues to leverage its core credit underwriting and loan servicing expertise both in its home market of Australia and other underserved markets in Europe and Asia.
  • Pepper is regulated by the Australian Securities & Investments Commission (“ASIC”) in Australia. Pepper Finance Corporation (Ireland) is regulated by the Central Bank of Ireland (CBI) in Ireland.

Pepper is ranked by S&P as a “STRONG” Residential Loan Servicer and is included on S&P’s Global Select Servicer List.

Oakwood Global Finance LLP (“Oakwood”) offers a "one-stop-shop" solution for loan servicing ranging from customer contact management and payment
processing through to market leading collections and loss mitigation services; all supported by advanced technology and accurate cash and data reporting. Engage Credit Limited, a member of the Oakwood group of affiliated companies, holds all appropriate FCA authorisations (Reg No. 484078) and performs all regulated activities for the group.

Oakwood offer clients a full range of in-house loan origination and administration services designed to meet their specific needs and objectives through-out the lifecycle of loans. Clients can select from among our services related to Loan Origination, Primary Servicing, Master Servicing and Special Servicing.

The Oakwood team of experienced servicing specialists, based in London and North Yorkshire, offer market leading Primary, Special and Master Servicing to lenders and investors. Oakwood's loan servicing platform holds 3 separate servicer ratings from international rating agency Fitch Ratings. The Company is one of the highest rated independent residential mortgage Special Servicers in the United Kingdom, holds Primary Servicer ratings for both prime and subprime mortgages, and is also a Fitch rated residential mortgage Master Servicer.