Palamon buys marbles for SAV

Palamon Capital Partners, a European mid-market buyout firm, has completed a sizeable bolt-on acquisition for its SAV Credit portfolio company, a UK credit card issuer. SAV has acquired HSBC Bank’s marbles and Beneficial branded credit card portfolios for a consideration of about £385m. The portfolios consist of 338,000 borrowers.

Daan Knottenbelt, a partner at Palamon who has overseen SAV Credit since the firm invested in the business in 2002 alongside Morgan Stanley Alternative Investment Partners, said the acquisition “moves the company to the forefront of the non-standard credit card market. Its abilities to underwrite and manage these products have attracted the support of major financial institutions such as HBOS, Credit Suisse, NM Rothschild and now Royal Bank of Scotland.”

Founded in late 2001, SAV Credit issues credit cards and related financial products to consumers who fail the standard underwriting rules of mainstream credit card issuers, representing about 20% of the UK adult population.

In March 2006, UK mid-market firm Electra Private Equity and Credit Suisse provided an equity and debt funding package of €140m (comprising €25m of equity and €115m of debt) to support SAV’s accelerated expansion plans.

UK-based Palamon’s other investments in the consumer credit sector include Sigla Group, an Italian consumer finance business; Nordax, a Swedish personal loans provider; and Si Collection, a Milan-based debt collection agency, acquired in March of this year.