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Cabot Square Capital acquires Blue Motor Finance

Cabot Square Capital, the specialist financial services private equity investor, has acquired Blue Motor Finance, the car finance provider.

Blue Motor Finance will offer auto finance backed by equity investment from Cabot Square Capital and a newGBP200 million long term funding facility provided by a major international bank. The company has agreements with fifteen major dealer networks and brokers that will use Blue Motor Finance’s funding and plans on significantly expanding its introducer relationships in the coming months.
 
Blue Motor Finance will offer funding across the entire UK prime auto finance market, giving both dealerships and consumers a major new choice in a market that has suffered from a loss of competition after the withdrawal of numerous finance providers in the aftermath of the credit crunch.
 
Blue Motor Finance specialises in new and used car finance, provided through dealerships, for consumers with good quality credit.
 
The company’s business is built upon an innovative technology platform and a market-leading processing system for applications. The systems can provide an approval for finance within 40-50 seconds. Payments are made to the dealer or broker on the same day – significantly improving the car dealer’s cash flow and customer satisfaction.
 
Blue Motor Finance is headed by Executive Chairman Bob Jones, an industry veteran who was a main board director of Lombard North central PLC then the largest instalment credit company in the UK.  Whilst there he substantially re-engineered the High Street Credit and Motor Finance divisions – returning both to profit.
 
Jones has also been CEO for two highly successful private equity owned financial services companies – Clydesdale Finance and NAAFI Financial Services.
 
Using the much expanded Clydesdale platform Bob conceived and created Barclaycard motor finance now known as Barclay Partner Services
 
The company will operate a five-tiered, risk based, product model, allowing it to provide finance to virtually any customer within the ‘prime’ auto lending market.
 
Jones says: “The partnership with Cabot Square Capital and the new funding line will help us to meet the demand in the market for a finance provider that can address the needs of all prime borrowers, and give dealerships quick and consistent decisions. Our industry-leading systems allow us to do just that.”
 
“We aim to be a one stop shop for motor finance, and with our previous track record of providing industry-leading solutions we are sure that consumers and dealers will welcome the new choice we bring to a market.”
 
“We believe that the GBP200 million of capacity we currently have in place is just the beginning, as there is a lot of pent-up demand in the market for prime motor finance. We’re hoping to help dealers unlock sales that might previously have been beyond their reach due to a lack of finance or due to delay in getting an indication of appetite from potential funders.”
 
“We have maintained excellent relationships with dealer networks and motor finance brokers across the UK, and those relationships will be the key to expanding our reach. In this we are extremely fortunate to have the services of Tony Ordish as Sales Director and Peter Critchley as Development Director, two of the most well regarded executives in the auto-finance industry.”
 
Tarun Sharma, Investment Director at Cabot Square Capital, says: “Dealerships and consumers in the motor sector have been restricted in their finance options since the credit crunch, and that has created a substantial opportunity for a new prime credit provider to step into the market.”
 
“Blue Motor Finance has the industry connections and platform to become one of the market leaders in car finance in a short period, and we are excited to partner with this experienced management team to help them to achieve that."

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