The Manchester business typically buys up personal loans, credit card debt and outstanding mobile phone bills for as little as 10p in the pound.
Arrow – one of the top three operators in its field – then applies its own database to try and track down the original debtor, who is then asked to agree a repayment plan.
“Arrow Global operates in a high growth market with significant barriers to entry,” said chief executive Tom Drury. He explained £50m would be raised through the issue of new shares and used to buy more debt.
The fast-growing company – which is regulated by the Office of Fair Trading and will soon be overseen by the Financial Conduct Authority – currently manages debt with a face value of £8bn. It expects existing assets to produce £637.4m of cashflow over the next decade.
The firm, whose main shareholder is a fund controlled by RBS, will skip Aim and go straight to a premium listing on the main London market. Its likely market value would place it just outside the FTSE 250.
The Arrow Global float is being handled by two nominees in this year’s City A.M. awards.
Goldman Sachs – up for bank of the year – is leading on the transaction as sponsor, global co-ordinator and joint bookrunner. Its team includes Peter Kimpel, Alasdair Warren, Julien Petit, Alex Watkins and Julien Dyon.
Kimpel became a partner at Goldman in 2010, having previously been head of the company’s German real estate department. He first joined the company back in 1992 and spent most of the 1990s working out of Goldman’s Frankfurt office, where he advised on internet and technology businesses.
Warren was last month appointed as head of its private equity team for Europe, Middle East and Africa. Petit has been with the company since 1999 and Watkins is vice president in Goldman’s equity capital markets team.
Jefferies is joint bookrunner, with a team including Lee Morton and Neil Collingridge.
Meanwhile, legal support comes from City A.M. awards nominee Slaughter and May, with a team led by partners David Johnson and Richard Smith. Canaccord and Numis are acting as co-lead Managers and Lazard is acting as financial adviser to Arrow Global.