Redpin

Invested:
November 2015

Exited:
Partially realised (2.1x)

Sector:
Financial Services

Stage:
Mid (core strategy)

Headquarters:
London, UK

Region:
Global

Business:
International payments provider

 

Business at time of investment

Palamon originally acquired Currencies Direct, a leading specialist foreign exchange (“FX”) and payment solutions provider. The company enabled its customers to perform FX transactions and transfers at highly competitive rates through its proprietary online platform, via email or by phone. Currencies Direct focused on high value private retail customers and SMEs. The company had a multichannel online and offline customer acquisition capability including an extensive proprietary network of affiliates who refer customers. The company had a client base of over 150,000 customers in Europe, the US, Australasia, and South Africa and enjoys very high rates of repeat business. 

Investment rationale

The specialist segment of the foreign exchange services industry is expected to grow two to three times as fast as the overall industry, as retail and SME customers continue to shift away from banks due to the superior service and pricing offered by the specialists. The market is consolidating around larger FX specialists with the scale to absorb increased regulatory, marketing and technology costs.

Value creation

  • Recruited chairman & new CEO: Appointed Antony Jenkins, former CEO of Barclays Bank, as Chairman, and Arnaud Loiseau, formerly CEO of WorldRemit (now Zepz), as CEO.

  • Expanded the affiliate channel: Continued to drive affiliate revenues, increasing active clients whilst maintaining strong margins.

  • Launched next generation technology platform: Made a significant investment in digital initiatives launching a new platform which uses API and Machine Learning capabilities and enables full transactional and bankside straight-through processing. Its multi-tenant architecture allows the Company to seamlessly pursue its global, multi-brand strategy and M&A programme.

  • M&A: Completed three value-accretive acquisitions.

  • Recapitalisations: On the basis of the continued strong growth performance since acquisition, completed three dividend recapitalisations, returning 2.1x MoC to date, including a strategic £140m investment from Blackstone Tactical Opportunities.

  • Launched Redpin: Launched a new strategy to become the market leader in embedded software and payments for residential property. Redpin plans to continue investing in its existing international payment network and services as well as grow through select acquisitions of property technology companies globally.

Company today

Redpin is a leader in international payments and embedded software for residential property and the owner of two market leading consumer FX businesses, Currencies Direct and TorFX. It is trusted by an ecosystem of over 15K partners across the property landscape, including legal service firms, notaries, escrow and title businesses, real estate agents and property management companies.