Link Group, a financial services administrator, has agreed to buy Pepper European Servicing (PES) in a deal worth up to €200 million, which will see employees in its Irish loan servicing team double to about 1,000.
PES’s Pepper Ireland unit manages €18 billion of assets, including 60,000 residential mortgages, some 80 per cent of which are performing loans, and 10,000 commercial loans.
PES has a total of €40 billion of assets under management, with the remainder in the UK, Spain, Greece and Cyprus. Combined, the businesses will have about €130 billion of assets under management and employ more than 1,800 people.
The transaction is at parent level and does not impact loan accounts or repayment arrangements being managed by either company. It also involves Pepper Ireland's fledgling Irish commercial mortgages business. Both Link Group and Pepper Group are based in Australia.
"In 2019, we set our strategic vision to become the leading independent servicer in Europe with an expanding global footprint," said Robbie Hughes, chief executive of banking and credit management at Link Group.
“This transaction accelerates that vision and will see two high-quality businesses integrated to create a leading pan-European asset servicer and manager, with significant potential for growth in existing and new markets.”
The Link business in Ireland largely stems from its acquisition of UK outsourcer Capita’s asset management arm in 2017.
Meanwhile, Pepper, which entered the Irish market in 2012 through the purchase of GE Capital’s Irish mortgage book, sold its Irish home loans platform, including €200 million of loans, to Finance Ireland in late 2018.