CIT Vendor Finance’s UK operation sold to venture capitalist

The acquisition of CIT Vendor Finance (UK) into Highbridge’s Pan European Asset Company (PEAC) aims to establish a strong asset finance platform with a continental-European growth strategy in the small to medium sized enterprises sector.

PEAC is an independent provider of asset financing in the UK, with a client base “exceeding 20,000 unique customers”. The platform provides leasing solutions across a broad range of asset classes, from business equipment to plant and machinery. PEAC will offer competitive financing solutions to equipment manufacturers, dealers and distributors through transactions sized “between £1,000 and £3 million”.

PEAC aims to focus on expanding its long-standing relationships across more than 250 partners, brokers and vendors in the UK and Europe. In partnership with Highbridge, PEAC also intends to grow its business into alternative asset classes and risk profiles across Europe.

In September 2011 CIT Group appointed of Rich Green as managing director of CIT Europe. In his new role he assumed responsibility for overseeing the European operations of CIT Corporate Finance and CIT Vendor Finance. Green was later appointed as president of CIT International Finance.

In 2015 Asset Finance International asked Green: “What have been CIT’s European growth plans since you assumed responsibility in terms of geography and market sectors?”

He replied: “We have two offices in the UK, one in Bracknell and the other in London where we have strong and experienced leadership teams. We service our vendor finance assets and portfolios from our service centre in Dublin. We are well positioned to take advantage of the opportunities in the UK where expertise has been our calling card and service excellence remains our hallmark.”

Given that vendor relationships have traditionally been CIT’s preferred market focus we asked what major new partnerships he could tell us about.

“New vendor partnerships are very important to us and we successfully added 75 new relationships to our business in the UK last year. We continue to enjoy successful relationships with the likes of Konica Minolta, Sharp and Alto Digital. Our Vendor business is an established operation with a great mix of vendors, including manufacturers, dealers and intermediaries.”

Green intended to remain focused on growing CIT UK’s vendor business profitably and to continue to opportunistically look at portfolio acquisitions that meet his return objectives as another alternative to organic growth in the portfolio in the UK.

We asked what Green saw as the greatest challenges to asset finance/leasing in Europe over the next 12 months? Do regulatory issues, such as proposed changes to the way that leases are accounted, offer a threat to the future of leasing?

“At a macro level,” he stressed, “the real challenge is to increase funding to meet the demand within the SME market. We keep an eye on things in the broader market, like the consumer confidence index, and the business confidence index and we have recently started to see that picking up a bit. We also see growth opportunities in the equipment leasing and financing sector as SMEs look to improve their efficiency and grow their businesses through the investment in new equipment. The needs are most certainly there due to the pent up demand that emerged because many companies refrained from making capital improvements during the Great Recession, and it’s our job to support them.”

He added: “I think that another key challenge for the industry this year will be raising our collective profile, developing a co-ordinated voice and corralling broader interest.”