Portfolio Recovery Associates Inc., a Norfolk, Va. debt buyer, announced today that it has acquired a controlling interest in the assets of Claims Compensation Bureau (CCB), a company that specializes in recovering funds and processing payments owed under class-action settlements.
"CCB pioneered the field of class-action settlement recoveries and payment processing," Steven D. Fredrickson, PRA's chairman, president and chief executive, said in a statement. "CCB counts many household names on its client roster and has expanded even beyond securities class-action settlements and payment processing into antitrust class-action settlements."
Terms of the deal include PRA purchasing 62% interest in CCB, with the right to buy the remaining 38%. Financial terms of the transaction, which was completed today, were not disclosed.
CCB's founder Brad Heffler and Norman Jung, the company's chief of operations, will retain their leadership positions with PRA, having worked out long-term employment agreements as part of the transaction.
CCB, founded in 1996 and based in Conshohocken, Pa., has more than 300 clients - including Fortune 500 companies and large privately held companies. According to PRA's statement, CCB's processes help clients "maximize settlement recoveries, in many cases participating in settlements they would otherwise not know existed." The company charges fees for its services and works with clients to identify, prepare and submit claims to class-action administrators charged with dispersing class-action settlement funds.
PRA expects class-action activity will continue to be a large market with billions of dollars in settlements each year in both the securities market and the anti-trust market.
PRA is the sixth-largest debt buyer in the U.S. with more than $206 million in revenue from purchased debt in 2008, according to research by Collections & Credit Risk. The company purchased $2 billion of face-value debt in the fourth quarter ended Dec. 31, paying $75.1 million. For a recent review of the debt-buying industry forecast,
