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July 7, 2022

M&G purchases 41% stake in Finance Ireland for €50m

UK-based M&G has announced the acquisition of a 41% stake in Finance Ireland, an alternative finance provider, for €50m. 

Finance Ireland, a top-tier non-bank lender in Ireland, offers a range of financial solutions including car finance, leasing, SME financing and agriculture loans. 

The Irish firm will use the proceeds for growing and expanding future lending, which surpassed the €1bn figure for the first time in 2021. 

Chief executive Billy Kane founded the lender in 2002 and it currently employs 170 people. 

In 2018, Finance Ireland forayed into the residential mortgage space, with M&G having bought around €1bn of these mortgages in the past three years. 

Last year, long-dated fixed-rate mortgages with terms of up to 25 years were launched with backing from an existing funding agreement with M&G Investments.

M&G private & alternative assets division chief investment officer Will Nicoll said: “Finance Ireland is the largest non-bank lender within the Irish market and is well-positioned to take advantage of favourable structural changes as some banks withdraw for core areas of lending. 

“In addition to the growth potential of the business, the investment provides us with long-term funding opportunities as we continue to partner with the team to bring innovative financing solutions to Irish businesses and consumers.”

Kane said: “This transaction is a huge vote of confidence not just in Finance Ireland but in the Irish economy, providing us with long-term investors to grow and expand our customer offering and execute our long-term growth strategy.

“M&G know our business well as funders of our residential mortgage book and we are delighted that they have taken this step to take a substantial equity position in our business at this time. The timing is also significant given the exit of Ulster Bank and KBC from the market as customers look for a new provider for their mortgage and for their business financing.”

M&G, a savings and investment firm, made the investment on behalf of the £143bn Prudential With Profits Fund and external client funds managed by M&G Investments.

Separately, Hampshire Trust Bank (HTB) relaunched HTB Syscap, a short-term loans provider.

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