SAN DIEGO, Feb. 25, 2014 /PRNewswire/ -- Encore Capital Group, Inc. (Encore), an international specialty finance company (NASDAQ: ECPG), today announced that it has taken a controlling stake in Refinancia, a leading debt purchaser in Colombia and Peru. Encore purchased 51 percent of the company in December 2013.
Encore's acquisition of Refinancia establishes Encore's presence in the high-growth Colombian and Peruvian markets, which together have nearly 80 million residents. Refinancia services distressed consumer debt, which it either purchases or services on behalf of others. It also offers merchant guarantee services, factoring arrangements, and a small credit card business in Colombia.
According to Ken Vecchione, Chief Executive Officer of Encore, the acquisition continues Encore's purposeful expansion designed to capitalize on growth and consolidation opportunities both domestically and internationally. "This transaction opens up two new markets in which Encore can deploy capital at higher returns than are available in the U.S.," he said. "In addition, Encore now has a beachhead in Latin America from which to expand, both geographically and into new specialty financial products designed for underserved consumers."Encore will bring to Refinancia its analytic strength, operational sophistication and deep knowledge of distressed consumers, creating opportunities for Refinancia to increase operating efficiencies and strengthen performance. Refinancia also shares Encore's commitment to fair and ethical treatment of consumers. Kenneth Mendiwelson, Chief Executive Officer of Refinancia, said, "We are excited to join Encore and gain the financial and operational support of a world leader. In turn, Refinancia provides Encore with immediate access to emerging markets in Peru and Colombia, and positions Encore for growth throughout the Latin American region. We look forward to working together to reach new levels of success." According to Vecchione, Encore has been deploying capital through Refinancia since late 2012 and plans to continue this activity. "We are taking the same approach with Refinancia that we took with Cabot, in which we acquire a controlling interest in the company with the expectation of increasing our ownership interest over time. In the meantime, the majority of the capital we invest is staying within the business to fund future growth."