Financial News

  • 5 December 2013, 10:23

Buyout Firms Battle Germans For Credit Agency

A pack of buyout firms is vying with Bertelsmann, the German media giant, for control of one of the UK's fastest-growing credit-checking agencies.

Sky News understands that a handful of bidders are competing to buy Callcredit Information Group, including Charterhouse, Permira and Chicago-based GTCR.

It is unclear which arm of Bertelsmann has expressed an interest in Callcredit, although sources suggested it was likely to be Arvato, a provider of business process outsourcing services.

The interest of the German conglomerate, which owns the RTL broadcasting group, the publisher Gruner & Jahr, and a stake in Penguin Random House, is at an early stage and may not lead to a formal offer, insiders said.

Vitruvian Partners, a buyout firm, is hoping to attract a price of around 400m for Callcredit, which it has owned since 2009.

Callcredit, which has been dubbed a "mini-Experian" because of its resemblance to the FTSE-100 credit referencing giant, employs around 800 people at sites across the UK.

It competes with Experian and Equifax in the credit referencing market, which is worth billions of pounds a year.

Previously part of Skipton Building Society, Callcredit has seen sales and profits grow rapidly since the business changed hands, with the business buoyed by growing demand for greater volumes of consumer credit data.

Callcredit has urged the Government to make greater use of technology in a bid to reduce the multibillion pound bill for benefit fraud which taxpayers are forced to foot each year.

Jefferies, the investment bank, is handling the sale.

Last year, GE Capital and Ares Capital Europe agreed to provide new debt facilities to Callcredit, while Lloyds Banking Group, Callcredit's existing banker, continues to provide clearing services and a revolving credit facility to the company.

Callcredit and Jefferies declined to comment.