Debt buyer Encore Capital Group Inc. announced Tuesday that it closed its acquisition of a controlling stake in Grove Capital Management, a management company that purchases credit portfolios and has a focus on United Kingdom insolvencies and Spanish assets. The acquisition received regulatory approval from the Financial Conduct Authority in the UK.
The purchase further builds San Diego-based Encores presence in the UK and continues an international expansion shift among large U.S. debt buyers. Encore in February announced a $481 million deal with UK-based debt buyer Marlin Financial Services and a $192 million deal with UK- and Ireland-based Cabot Credit Management.
Debt buyer Portfolio Recovery Associates recently agreed to acquire Aktiv Kapital AS, an Oslo Norway-based accounts receivable management company in one of the largest deals in accounts receivable management history.
Groves largest business is the purchase and management of insolvencies, mostly bankruptcy receivables and individual voluntary arrangements - a type of repayment plan negotiated with creditors and entered into by individuals or businesses that wish to avoid a bankruptcy.
Grove tries to differentiate itself and drive strong collections performance partly through a strong relationship with TDX Group, the largest servicing platform for individual voluntary arrangements in the UK. As a result, Grove has quickly grown to be among the larger investors in UK insolvency assets.
"This acquisition is yet another example of Encore's purposeful expansion into new geographies and asset classes," said Ken Vecchione, CEO of Encore. "We believe this transaction, along with our other recent acquisitions, provides us with increased optionality by enabling us to allocate capital in multiple asset classes in multiple geographies, to bring our shareholders the best returns."
Kevin Fuller, CEO of Grove, said, "We believe we can now be an even better partner for our UK clients and accelerate our growth in Spain and other European markets, while maintaining the agility and responsiveness that have been key to our success."
Encore is a publicly traded NASDAQ company (ticker symbol: ECPG).