LCM Partners, the London-based European alternative credit manager, has signed a strategic partnership with Brookfield Asset Management, the Toronto-headquartered global asset manager with $285 billion under management.
The aim of the partnership is to grow LCM’s asset management and credit servicing business globally. It sees Brookfield acquire an initial 25 percent interest in Link Financial Group, the pan-European loan servicing platform which comprises LCM and sister companies, with the option of a further 24.9 percent interest “over time”.
Launched in 1998 in the UK, Link Financial Group now has 10 European offices and is a credit manager focused on investing in and servicing consumer, SME, auto, leasing and commercial loans. It has over 2,500 portfolios of performing, rescheduled and non-performing loans acquired from banks and financial institutions.
Through the partnership, “…we can further develop our business, not only as one of Europe’s leading credit asset management and loan servicing firms but to become one of the pre-eminent firms globally,” said Paul Burdell, chief executive officer of LCM and Link Financial Group.
Ralk Rank, managing partner at Brookfield said the firm would work with LCM “to support the growth of its platform via expansion into new markets, diversification of its product offering, and through pursuing investment opportunities leveraging the capabilities of both firms”.
A statement said Link Financial Group would continue to operate independently under its current leadership. The deal, for which financial terms have not been disclosed, is expected to be completed in the next quarter. London-based advisory firm Spencer House Partners provided financial advice to Link Financial Group.
LCM is currently investing from its LCM Credit Opportunities III strategy, which closed in 2016 with more than €2 billion of capital including €865.5 million for a comingled fund and a number of managed accounts. Investors included Arizona State Retirement System and the Teachers Retirement System of the State of Illinois.
LCM says it has delivered an unleveraged internal rate of return of 14.8 percent since 1999.