Allied Credit, the auto financing business backed by former UBS Australia boss Matthew Grounds, is understood to be vying for Westpac’s auto loans portfolio up for sale through investment bank Morgan Stanley.
The tilt by the company is understood to coincide with a return by Mr Grounds to the investment banking scene, with reports circling in the market that he has finally joined the top ranks of Barrenjoey Capital.
This is after much anticipation that he would be part of the investment banking start-up launched by several top UBS operatives, including Guy Fowler, who is executive chairman, and bankers Matt Hanning and Chris Williams, who are founding partners.
Sources say Mr Grounds had a non-solicitation agreement in place that was initially due to end in December but was later extended to March or April.
Mr Grounds did not respond to a call made by DataRoom, while Barrenjoey Capital did not comment on whether he had started at the firm.
However, multiple sources say they understand he has already been working at the investment banking start-up for at least a week.
Mr Grounds is understood to be an investor in Allied Credit, which is now believed to be vying for the Westpac auto loans business.
DataRoom can reveal that it will be competing with listed personal loans provider Plenti to buy the division, and Taurus Motor Finance.
The suitors are expected to be backed by major private equity funds in their efforts to buy the Westpac auto loans operation.
Initially, more than 30 parties were understood to have signed non-disclosure agreements to examine the portfolio. However, in the past fortnight, the contest is understood to have taken a different direction.
Initially, the understanding was that $11bn worth of loans were on offer for a buyer.
But now it is believed Westpac is only planning to sell the opportunity to land any new business and it would retain the existing loans that are in place.
It leaves suitors vying for about $2bn of loans, with the floor plan financing still to remain on offer, rather than the $11bn initially thought to be up for grabs.
The business writes about $5bn worth of loans a year, so any potential buyer would needed to have backing from a group with deep pockets.
Other private equity firms understood to be lining up for the portfolio are Cerberus, TPG Capital with Liberty Financial and Bain Capital.
Barrenjoey Capital could be well placed to win an advisory role assisting Westpac, which is looking to sell down non-core assets.
Mr Grounds is said to have a close relationship with chief executive Peter King and there are plenty more assets to sell by Westpac.
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