Skipton Building Society today announces the successful sale of its majority stake in credit reference and marketing services subsidiary Callcredit Information Group (CIG), in a deal signalling positive opportunities for both businesses.
Vitruvian Partners, the London-based private equity firm, has purchased Skipton's share for an undisclosed sum with the full support of CIG's management team.
This follows a successful partnership spanning almost a decade which has seen Skipton working with CIG management to establish the business and develop it beyond all recognition, to become one of the UK's leading suppliers of credit and marketing information.
The deal generates around £40m of additional profit for Skipton, boosting the Society's already strong capital base. For CIG, it marks the start of a new era as an independent organisation, extending its reach to new customers and markets.
Vitruvian Partners will take Skipton's place on the Board and is looking forward to injecting fresh investment, ideas and experience into the business's future development. However, CIG will continue to pursue its clear strategic direction under its current leadership.
Skipton Group Chief Executive David Cutter said:
"CIG has been a major success story for Skipton of which we are very proud." Our support and guidance has enabled the business to penetrate the credit referencing and marketing information markets and, in doing so, to become a serious rival to the major players, from which it continues to take market share."Following a strategic review, Skipton decided CIG was no longer core to our future business direction. At the same time, CIG has huge further potential and is now ready to enter the next stage of its development as an independent business with ambitious aspirations."Therefore we concluded that this is the appropriate time for CIG to move on and for its next growth phase to be supported by private equity, rather than ourselves as a member-owned building society.
"We're delighted to have achieved such a positive outcome for CIG's staff, and for Skipton, and this substantial boost to our profitability and financial strength will provide a real shot in the arm for our own future business ambitions."
CIG was established in 2000 and now has over 600 employees and annual turnover of around £50m. Last year it recorded profits of £5m.
John McAndrew, Chief Executive of CIG, added:
"We are extremely grateful for the help and support of Skipton over the past nine years."We have a reputation for differentiating ourselves through innovation and delivering outstanding value and service. To do this, we have been investing in people, technology and new products. We now have plans to explore new markets and geographies and are very optimistic that this change of ownership will provide us with the impetus to achieve our goals.
"We're delighted that Vitruvian Partners emerged as the buyer because they are committed to supporting our existing business strategy as well as our vision of growth through both organic development and acquisition."
David Nahama, who is a founding partner at Vitruvian, added: "We are delighted to be working with John and his team at this very exciting stage of their development. CIG sits right in our sweet spot as an entrepreneurial organisation, deploying smart technology and with a strong, customer-centric management team and great strategic opportunities ahead of it."
The UK's fourth largest building society*, Skipton is at the hub of a unique group of 21 subsidiary companies and has a strong track record as a creator, acquirer and disposer of successful businesses.
This transaction is the latest example of the scope and potential of the diversified Skipton Group model, and the considerable value embedded in the Society's range of subsidiary businesses. It also follows a string of positive developments for Skipton this year. The Group announced half-year profits of £17m and expects to announce increased full-year operating profits next Spring.
Its merger with Scarborough Building Society, in March, significantly boosted Skipton's scale and capability, adding approximately 200,000 new saving and borrowing members. Then, in July, it acquired Capital One's UK savings portfolio, adding a further 50,000 saving members.
Late last month, Skipton successfully accessed £650m of additional funding under the Government's Credit Guarantee Scheme. Its issue of packaged debt was three times over-subscribed and adds a further dimension to the Society's robust and diverse funding, approximately 80% of which comes from retail deposits.
Skipton was advised by J.P. Morgan Cazenove and Addleshaw Goddard LLP.
* KPMG Database 2009, as adjusted for subsequent published results and announcements.
For further information, or to arrange interviews, please contact the Skipton Press Office on 08456 017247, email firstname.lastname@example.org or visit the press section of our website at www.skipton.co.uk
Tracy Fletcher, Head of PR
If outside Press Office hours (9am - 5pm, Monday to Friday), please call 07867 851628
The CIG Press Office on 0844 875 1458 or via
Skipton Building Society Key Facts
- Skipton is the UK's fourth largest building society, with approximately 850,000 members, £15.2bn of assets and a national presence represented by its 90 branches, covering the country from Aberdeen to Plymouth. It heads the Skipton Building Society Group, whose subsidiary companies have significant interests in estate agency and related businesses (through the Connells and Sequence groups); third party mortgage servicing (Homeloan Management); independent financial and related advisory businesses, and support services to the mutual sector;
- Skipton is the first UK-wide financial services provider to receive the Customer First Framework - a quality assurance standard aimed at putting the customer first.
- CIG was created as a start-up in the Skipton Group in 2000 to compete actively against the large incumbent credit rating agencies
- It brings together experts across the fields of credit referencing, marketing services, interactive solutions and consultative analytics to enable its client base of businesses and consumers to make informed decisions using its innovative products and services. Find out more at www.callcreditgroup.com;
- The group is made up of two complementary divisions:
- Credit Solutions, specialising in credit risk, decision analytics, Identity verifications services and tracing tools;
- Marketing Solutions, providing specialist knowledge in customer analytics, targeting, database building and hosting, marketing communications, business modelling and market analysis;
- In total CIG employs over 600 people across its sites in Leeds, Bristol and Gerrards Cross.
About Vitruvian Partners
- Vitruvian Partners is an independent private equity firm that specialises in backing entrepreneurial managers through middle-market buyouts, growth buyouts and growth capital investments in the UK and Northern Europe, in sectors such as Financial Services, Technology, Media, Business Services and Leisure;
- The Firm was founded by a group of principals whose experience in the industry dates back to 1990 and who have demonstrated an ability to invest successfully over multiple market cycles across a spectrum of industries.
Skipton Building Society, Principal Office: The Bailey Skipton, BD23 1DN
Skipton Building Society is authorised and regulated by the Financial Services Authority under registration number 153706.
Skipton Building Society is a member of the Building Societies Association and Financial Ombudsman Service.
Scarborough Building Society, Principal Office: Prospect House, Lake View, Eastfield, Scarborough, North Yorkshire, YO11 3YU
Scarborough Building Society is authorised and regulated by the Financial Services Authority under registration number 206062.
Scarborough Building Society is a member of the Building Societies Association and Financial Ombudsman Service.