Five Arrows Leasing might have
suffered a bit as a result of the recession, but Sam Geneen, its
well known managing director, has only one plan in mind – to
continue running the business in the way he has done since he
founded it 22 years ago.
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Lots of things have changed at Five
Arrows Leasing Group over the years. All in all, however, the
Richmond-based leasing company has continued to pursue the same
approach to the market, with a focus on niches rather than a
head-to-head competition with the largest players.
This might be because its management has always
been the same.
Five Arrows Leasing Group’s MD, Sam Geneen, a
well-known veteran in the UK leasing industry, has been running the
business since its launch in 1988, and so have Philip Davies and
John Luff, who now head two of the group’s subsidiaries, LPM
Outsourcing and State Securities.
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By GlobalDataFocusing on a niche
When it was launched, the company was
called Oko Finance and was owned by a Finnish co-operative bank. NM
Rothschild acquired it in 1996 and has owned it since.
The name subsequently changed to New Court
Finance, but later changed again to Five Arrows Leasing when
Toronto-based New Court Credit entered the UK market.
“We decided from those early days that we
wanted to focus on niche businesses,” Geneen said.
“The reason is that we’ve always believed that
there are better returns if you have a deeper understanding of
certain markets, and competition in the niche sectors is less, so
we can get the margins that our shareholders require.”
Those niches have included businesses the
lessor has now exited, and businesses it still is in.
For instance, it exited the material handling
business (selling its resources to De Lage Landen) when higher
competition meant that to remain profitable it would have to scale
up the business – which it was not prepared to do.
It also had a regional car finance division in
Wales and the North East of England, but decided to exit this
market in 2005 after realising that dealers were looking for
value-added services but were not prepared to pay a premium.
The current focus is on a number of areas,
including contract hire for the public sector, subprime asset
finance and media finance.
For Geneen, the rationale behind the business
is still the same – to get a good return on investment, and to
focus on the right people.
“The particular niches are mainly driven by our
access to the skill set. If we can find an individual or a team of
people who are strong in a specific sector, that’s of interest to
us. Being in a niche requires a level of expertise,” he said.
Maintaining close
relationships
Another thing which overall has not
changed has been its relationship with its parent company.
Geneen said: “We have always had a very close
relationship, but from the point of view of writing the day to day
business, they leave it to the local management.”
He said that behind that strong relationship
there was a lot of communication – with quarterly board meetings,
information provided on a monthly basis, and probably few surprises
over the 14 years it has owned the lessor.
If anything, for Geneen that relationship has
become stronger, because all the funding now comes through
Rothschild.
“We used to borrow it on the open market, but
that changed before the credit crunch, and incidentally had nothing
to do with it,” he said.
“We decided that it was more efficient for us
to borrow direct from Rothschild.”
Profile of Five Arrows Leasing
Group Limited
