Strong interest as buyers line up for Westpac car loan portfolio

Some 36 parties are understood to have signed nondisclosure agreements to enter the data room for Westpac’s car loan business. Picture: AFP

Westpac’s plans to sell its $11bn car loans and dealer finance portfolio through Morgan Stanley appears to be drawing a large crowd, with 36 parties understood to have signed nondisclosure agreements to enter the data room.

Among them are Cerberus, Affinity Equity Partners and TPG Capital in partnership with Liberty Financial — the business it looked at buying an interest in around 2019.

The division writes about $5bn annually, and a sale is thought to be well timed to coincide with the boost in car sales numbers following the global pandemic.

Which party lands the mandate to sell Westpac’s BT Wealth Management platform is also generating great interest in investment banking circles.

So far, the thinking has been that Goldman Sachs is on the ticket, but now some are questioning whether Barrenjoey Capital and former UBS Australia boss Matthew Grounds are about to surface close to the action.

Barrenjoey is believed to be focusing on winning mandates after its well-flagged assault on the analyst ranks within UBS last week.

Some think it is in pole position to land a role.

Some suspect that Matthew Grounds, representing not-for-profit advisory shop Adara Partners, could also be in the picture.

Mr Grounds was always expected to be involved in launching the new Barrenjoey venture, along with former top UBS deal makers Guy Fowler, Chris Williams and Matt Hanning, but a non-compete agreement has prevented him from doing so.

However, the understanding is that it is expected to end in April.

Mr Grounds is known to have a strong relationship with Westpac chief executive Peter King that dates back some time.

Barrenjoey’s financial institutions group’s investment banking head is led by former JPMorgan banker Anthony Brasher.

Westpac last year started moving forward on plans to sell more than $4bn worth of non-core wealth assets as the bank focuses on mainstream banking and returns funds to its core operations in the challenging COVID-19 environment.

Westpac, with its Panorama wealth management platform, is the largest platform provider in Australia. It has a 19 per cent market share and started a price war in 2018 by lowering its platform pricing.