Listed credit provider expands online operations with acquisition

Morses Club, a publicly traded home-collected loan provider, has grown with the £ 8.5million acquisition of a well-established non-government online lending specialist.

Shelby Finance Ltd, a subsidiary of the Walrus Club, has agreed to purchase the business and certain assets of Leeds-based CURO Transatlantic Ltd under the name WageDayAdvance.

Founded in 2004, Wage Day Advance is an online payday loan provider for the UK consumer market. In 2014, the company established its headquarters at Wellington Plaza in Leeds.

Howard Smith and Ed Boyle of KPMG were appointed co-directors of CURO Transatlantic Ltd (CTL) today (February 26) and oversaw the sale.

Walruses Club is in the process of acquiring CTL’s existing infrastructure, including its decision-making platform, call center and online lending capabilities. Eversheds Sutherland advised Walruses Club.

The current 205 employees of CTL will become employees of Shelby Finance. Gross accounts receivable (before any collection allowance), which excludes all CURO Transatlantic bad debts identified by the Walrus Club, amount to approximately £ 19m.

The co-administrators are currently determining their strategy for CTL’s remaining loan portfolio and will contact clients with outstanding balances in the coming weeks as soon as their strategy is finalized. Customers who have potential recourse against CTL will also be contacted in the coming weeks to explain their position and, where appropriate, invite them to file a complaint with the administration.

The acquisition was said to fit well with the Walrus Club’s strategic priority to increase its online offering in response to growing demand. It adds a customer base of around 50,000 customers.

“This exciting acquisition of such a well-established online lending business represents a significant increase in the Walrus Club’s product diversification strategy,” said Walrus Club CEO Paul Smith.

“The line of online lending products that we will roll out through the newly acquired platform will exclude any form of payday lending and the style of trading will be abandoned.

“The loan products will fit perfectly into Dot Dot Loans’ current strategy in terms of loan term, accessibility and forbearance.

“This acquisition, in addition to those recently announced in our core HCC marketplace, strengthens our plans to build a digital platform to meet the evolving needs of our customers across the UK, whether online or home.

Ed Boyle of KPMG added, “We are pleased to have secured the sale of the business to Shelby, which is the best result available under the circumstances for CTL’s creditors and other stakeholders.

“CTL has been the subject of significant consumer litigation due to its affordability, creditworthiness and responsible lending practices.” Over time, and with the increase in the number of complaints, the financial and operational burden of resolving them has become unsustainable.

“The co-directors will now work to realize the remaining assets of the company and then distribute the available funds to creditors.”

Howard Smith and Ed Boyle were also today appointed co-directors of SRC Transatlantic Ltd (SRC), the UK holding company of CURO Transatlantic. The SRC previously operated as a short-term, high-interest rate lender through a small number of big-box stores under the Speedy Cash brand and stopped lending in 2017.

Current and former CBC clients with outstanding loan balances will be contacted in the same manner as those of CTL, and the co-administrators will invite to submit creditors’ claims in a timely manner.

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