Netsol has acquired the remaining 49% stake of Virtual Lease Services (VLS), a UK-based portfolio and risk management servicing partner for business and consumer finance providers.
Netsol initially acquired a 51% majority stake in VLS through a joint venture partnership with Investec in 2011.
Netsol said it and Investec had worked together with VLS to grow the business and integrate complementary technologies, such as Netsol’s LeaseSoft and next-generation NFS AscentTM platform.
As a result in the past three years, VLS has recorded a 3-year compound annual growth rate (CAGR) north of 20%, with the company becoming increasingly profitable over that period, said Netsol.
Since the company’s founding in 1999, VLS has operated a back-office product to provide its customers with a variety of flexible and cost-effective portfolio and risk management services.
These services include complex, middle and large ticket leases, consumer loans, SME installment credit (including rental, lease, and service), as well as cash management. VLS manages over £1.5bn of audited and standby assets, has facilitated more than 500,000 contracts and currently collects around £20m each month, with close to £500m receivables under management. In its 20-year history, VLS has earned the trust of banks, independent lenders, investment funds and securitization partners.
“VLS is a highly complementary business to Netsol’s core competencies and has substantially improved its financial profile over the past several years since our initial strategic investment,” said Netsol co-founder, chairman and chief executive officer Najeeb Ghauri.
“Being a long-time user of our LeaseSoft product, VLS is well-versed in Netsol’s technology solutions, making this next step a seamless transition and a perfect complement to our overall European growth plan. Beyond the immediate monetary benefits we expect to receive from this accretive acquisition, VLS also provides us with a new opportunity to begin convert existing customers and marketing to new customers for our Next-Gen NFS Ascent. This partnership has already proven to be mutually beneficial over the past several years, and we look forward to maximizing additional growth opportunities, thereby expanding our footprint in the UK and European markets.”
Louise Ikonomides, managing director at VLS, said: “We’ve maintained a strong relationship with NETSOL since our partnership began in 2011 and are looking forward to strengthening that bond in becoming a wholly-owned subsidiary. We have continued to grow our client base to 34+ Tier 1 Lenders and Financial institutions, closing 2019 on £3.8m of revenue with £893k net profit. By fully assimilating with Netsol, we will be in a better position to leverage the company’s extensive resources and industry expertise to grow and expand our business within new and existing customers.”