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Britannia pays out £55m for PHL

Britannia, the Uk&#39s secondbiggest building society, has become the first mutual to buy a sub-prime lender with the £55m acquisition of Platform Home Loans.

The deal will add £550m to Britannia&#39s existing mortgage book of around £15bn and will allow the society to compete in the prime, adverse-credit and intermediary market.

Britannia bought Platform from Cabot Square Capital, a London-based private equity investor with around $300m (£214.3m) under management.

The deal comes as increasing numbers of mainstream lenders look to increase their core profit margins away from the increasingly cut-throat competition in the traditional lending market.

Platform has a 10 per cent share of the non-conforming market and is one of the top three lenders in the sector behind Kensington and igroup.

Its senior management team will remain with the company and will continue to act as a separate company focusing on distribution through intermediaries.

Britannia only markets its products through its branch network, over the internet and through its telesales operation although it also operates Verso as its mainstream intermediary arm.

Britannia group finance director Neville Richardson says: “Platform is a well-run business with sound knowledge and expertise of the non-conforming market. It has seen excellent growth over the last two years and, with the capital support Britannia brings, we expect this success to continue.”

Platform managing director David Tweedy says: “Non-conforming lending is proving to be one of the fastest-growing sectors of the UK mortgage market and the relationship with Britannia will allow us to develop our products further.”


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