ESF deal will help ThinCats prosper; FINANCE.
Byline: TAMLYN JONES email@example.com
APEER.TO.PEER lending firm was has lent out more than PS140 million since being founded five years ago has been bought out.
Tamworth-based ThinCats has sold a 73.4 per cent stake of the business to what is claimed to be Europe's first peer-to-peer institutional accelerator ESF Capital. ESF invests in, and underwrites the loans on, selected European peer-to-peer platforms and brings operational expertise to accelerate the growth of such platforms.
It is backed by UK and US institutions and is the initiative of European specialist investment company ESO Capital. ThinCats and ESF have been working together for a number of months and say they have a detailed plan to accelerate the former's market presence.
ThinCats was set up in 2010 by former manufacturers Kevin Caley and Peter Brown in a direct challenge to the banking sector's so-called "fat cat" mentality. It aims to cut out the banks and connect investors directly with established UK business borrowers, providing an alternative for both investors seeking decent returns and companies needing funding to develop.
Investors registering on the platform can bid directly on loans to UK businesses, all of which have been vetted by a network of sponsors.
ESF's chief executive John Mould has taken on the same role at Thin-Cats with overall responsibility for driving the business' growth strategy and delivering a raft of benefits for borrowers and lenders.
Mr Caley will remain with the new-look business as chairman with responsibility for innovation and Mr Brown retains his post as finance director.
The investment from ESF will allow ThinCats to carry out planned platform improvements and develop new products.
ESF says it also plans to strengthen ThinCats' internal due diligence capabilities, reviewing and categorising the quality of each loan.
Mr Caley said: "This investment by ESF is the fuel we need to take the ThinCats platform up a gear, to retain and extend this core lender base and to attract a broader range of investors. It's a big step forward and will allow ThinCats to cement its place as one of the UK's big four peer-to-peer providers."