LSL Property Services has partnered with private equity investor Pollen Street Capital to create a new mortgage and protection broker, named Pivotal Growth Limited.
LSL chairman Simon Embley has been appointed chief executive and deputy chair and senior independent director Bill Shannon will become chair of the LSL board and the nominations committee.
Meanwhile, LSL chief executive officer David Stewart and PSC partner Ian Gascoigne have been named Pivotal Growth directors while LSL director of mortgage services David Copland will take on the strategy and business development director role.
The venture will see “at least” £200m made available to fund acquisitions with a view to ‘buy and build’, with LSL committing up to £33.5m and up to PSC £62.4m, the rest being made up of external debt finance. The venture has an exit timeline of three to six years.
LSL says that over 50 large businesses have been identified as potential buys and that after focussing on these it will target smaller firms.
Developing technology solutions, “first class” regulatory compliance and high levels of customer service are the philosophies that will drive Pivotal Growth, according to the partnership.
It adds that leveraging the ‘Toolbox’ infrastructure that runs LSL’s mortgage networking Primis will reduce administrative and support costs and act as a platform for Pivotal Growth’s acquisition strategy.
Primis chief risk officer and e.surv managing director will move from these roles to work as Pivotal’s chief operating officer.
LSL group chief executive David Stewart says: “The launch of Pivotal Growth marks a significant milestone in the implementation of the group’s strategy. It follows other significant recent announcements, including the steps we have taken to strengthen our management team and recent acquisitions of Mortgage Gym and Direct Life & Pension Services.
“The establishment of the Pivotal Growth joint venture with Pollen Street Capital will enable us to establish a leading position in the provision of direct-to-consumer advice and underpins the pre-eminent position of our Primis network.
“I look forward to describing our plans further when we release our Preliminary Results on 28 April.”
And Pollen Street Capital partner Ian Gascoigne comments: “We believe that LSL’s unrivalled experience and expertise in the financial and property services markets and Pollen Street’s extensive capabilities in investment and business transformation, form the basis for a highly successful partnership.
“While large and long established, the UK mortgage broking market remains highly fragmented, offering significant potential for synergistic consolidation. We believe that Pivotal Growth has potential to quickly become a market leader, while delivering pioneering levels of innovation and the highest standards of customer service in the industry.”
