Posted on 08/28/2022
Canada-based ECN Capital Corpration is a provider of business services to North American based banks, credit unions, life insurance companies, pension funds, and investment funds. ECN Capital originates, manages and advises on credit assets on behalf of its partners, specifically in secured loan portfolios in the manufactured housing business, marine and RV business and credit card portfolios.
On August 24, 2022, ECN Capital Corpration sold its issued and outstanding equity interests in ECN Kessler Holdco LLC (Kessler Group), a wholly-owned, indirect subsidiary of ECN through which ECN operates the Kessler Group business to funds managed by Stone Point Capital LLC. The sale is expected to generate cash proceeds of US$ 210 million for ECN Capital. Following the closing of the transaction, ECN Capital expects to use the net proceeds to initially pay down debt and then redeploy a portion of the proceeds to accelerate its tuck-in acquisition strategy in its prime marine and RV financing business. The transaction is subject to customary regulatory approvals and the satisfaction of the other closing conditions set forth in the transaction agreement and is expected to close late in the third quarter of 2022 or early in the fourth quarter of 2022.
Credit Cards
The Kessler Group is a Boston-based firm. In 2019 ECN Capital purchased additional minority ownership resulting in 96% ownership of the Kessler Group. On May 10, 2018, ECN Capital made a minority stake in Kessler and invested US$ 221.2 million into it. Kessler Group was founded by Howard Kessler who pioneered co-branded credit cards by launching the first affinity card with MBNA and helped build MBNA from its infancy to its sale to Bank of America for US$ 35 billion.
Advisors
Truist Securities, Inc., CIBC World Markets Inc., BMO Capital Markets and Solomon Partners, L.P. acted as financial advisors to the Company and Baker Hostetler LLP and Blake, Cassels & Graydon LLP acted as legal counsel to the Company in connection with the transaction. Kirkland & Ellis LLP acted as legal counsel to Stone Point in connection with the transaction.
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