Duo Bank of Canada has brokered a deal to purchase subprime lender Fairstone Financial from investment firms J.C. Flowers & Co and Värde Partners.
The financial details of the transaction have not been made public.
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The deal includes all operating subsidiaries of Fairstone Financial as well as its 1,400 plus employees.
Fairstone lends directly to consumers and finances consumer credit through a network of 239 branches.
It has over $3bn in assets on a consolidated basis.
J.C. Flowers managing director Thomas Harding said: “The transformation Fairstone has undergone in only three years has been remarkable, and we’re pleased to have helped create the leading non-bank lender in Canada.”
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By GlobalDataVärde Partners head of North America & Asia financial services said: “We partnered with the team to create a fully standalone operating and financing model with new technology and digital capabilities deployed.
“Värde’s more than 20 years’ experience investing in the sector enabled us to help the Fairstone team take the business to the next level.”
Subject to receipt of regulatory approvals, the transaction is expected to close in the second quarter of 2020.
Fairstone Financial was earlier known as CitiFinancial Canada. Private equity firms J.C. Flowers & Co. and Värde Partners acquired Fairstone in 2017 from Citi.
