According to Duo Bank, the acquisition of Fairstone Financial will create a major financial services company with more than CAD4bn ($3.02bn) in receivables
Fairstone Financial to be acquired by Duo Bank of Canada. (Credit: Tumisu from Pixabay)
Duo Bank of Canada has agreed to acquire Canadian non-bank credit solutions provider Fairstone Financial from an investor group led by J.C. Flowers & Co. and Värde Partners.
Financial terms of the deal have not been disclosed by the parties.
Headquartered in Montreal, Fairstone Financial caters to near-prime borrowers. It has more than CAD3bn ($2.27bn) in assets on a consolidated basis.
Formerly, operating as CitiFinancial Canada, the credit solutions provider was acquired by J.C. Flowers and Värde Partners in 2017 before its rebranding to the present name.
According to Duo Bank, the acquisition will create a major financial services company with more than CAD4bn ($3.02bn) in receivables. Based in Toronto, Duo Bank is owned by an investor group led by funds managed by affiliates of Canadian financial services entrepreneur Stephen Smith and private investment management firm Centerbridge Partners.
Duo Bank management comments on Fairstone Financial acquisition
Duo Bank chairman Stephen Smith said: “Duo Bank’s mission is to provide value-driven financial products that are clear and simple, enabling Canadians to focus on what matters to them. Fairstone’s close to 100-year history of providing near-prime borrowers with access to responsible credit is perfectly aligned with this mission.”
Fairstone Financial has two main business lines, with one of them focused on lending directly to consumers via its branch network and online. The other business line is engaged in financing consumer retail and car purchases via retailers and dealerships.
The transaction includes all of Fairstone Financial’s along with its workforce of more than 1,400 employees.
Fairstone Financial president and CEO Scott Wood said: “We’re very pleased to be joining forces with a Canadian financial services institution that shares our customer-focused commitment and community-driven approach to helping everyday Canadians access financial solutions that fit their needs.
“We look forward to enhancing the complementary growth potential of both businesses.”
The deal, which is subject to regulatory approvals and other customary closing conditions, is anticipated to be completed in the second quarter of this year.