SAN DIEGO, May 20, 2013 /PRNewswire/ -- Encore Capital Group, Inc. (Nasdaq: ECPG), through its subsidiaries (the "Company"), a leading provider of debt management and recovery solutions for consumers and property owners across a broad range of assets, today reported the successful closing of a $100 million asset-backed credit facility (the "Facility") with Wells Fargo Bank, N.A. (the "Lender"). The Facility will be used to finance the acquisition of tax lien certificates from municipalities in multiple states.
"We are driving growth for Propel through three separate strategies: optimizing the tax lien transfer business in Texas, expanding our consumer-friendly model to other states, and acquiring tax lien certificates in states that already have established practices," said Encore Capital Group President Ken Vecchione. "The closing of the Wells Fargo Credit facility will enable us to accelerate our efforts related to the third prong of our strategy. We expect to deploy significant capital over the next few years in this asset class, and with this facility, we have a solid foundation on which to build."
The Facility consists of a $100 million revolving credit facility maturing on May 15, 2017. Borrowings under the Facility bear interest at LIBOR plus 3.25%. The assets acquired by Encore's subsidiaries through the Facility will be pledged to the Lender as security and will be serviced by Propel Financial Services, LLC.
"We are pleased to demonstrate once again our ability to access the financial markets on favorable terms. Combined with our existing facility at Propel, we now have $300 million of capital available to originate tax lien transfers and acquire tax lien certificates," said Executive Vice President and Chief Financial Officer Paul Grinberg. "We're also delighted to welcome Wells Fargo – another highly respected financing partner – to our company."Encore Capital Group is a leading provider of debt management and recovery solutions for consumers and property owners across a broad range of assets.