FORTUNE -- Yesterday's big private equity news was that Chicago-based GTCR is paying more than $1.4 billion to acquire Premium Credit Ltd., a British provider of payment facilitation and financing services. Basically, it helps customers and businesses in the UK and Ireland pay insurance premiums in installments, rather than in a single annual payment.
The seller was Bank of America (BAC), which acquired PCL as part of its $35 billion acquisition of credit card issuer MBNA in 2006.
A few notes, based on a conversation with someone familiar with the deal:
1. BoA and GTCR first began talking about PLC two years ago, with at least one other private equity firm also expressing interest. Then things tapered off, as BoA had some bigger fish to fry. Discussions between the two sides never really ended, and intensified over the summer.
2. At first glance, this looks like a giant price-tag for GTCR, which is investing out of a $3.25 billion fund. But my understanding is that the equity check is only for between $200 million and $300 million. That $1.4 billion figure includes not just leveraged financing, but also the value of funded receivables.
3. Overall, a very complicated transaction. GTCR first needed to transfer the funded receivables on BoA's balance sheet onto a new balance sheet created to hold the assets. Then that new holding company needed to be funded by a securitization that involved 5 european banks, which then needed to be rated. Finally, GTCR needed to equitize the holding company, plus provide additional working capital. Plus the standard work that comes with an acquisition.
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A payments deal that isn't about the consumer.
Chicago-based private equity firm GTCR has agreed to buy BankServ, an outsourced provider of money transfer and payment solutions to banks and other financial institutions.
The deal is expected to close later this week, with GTCR committing up to $300 million in equity. Around half of that will be the purchase price for Las Vegas-based BankServ, while the rest will be reserved for add-on MOREDan Primack - Aug 16, 2011 3:44 PM ET
Not too long ago, private equity fund managers were subjected to little due diligence as investors rushed to write checks before being shut out. Now investors are in charge.
"They came in to interview our CFO and controller, to ask about our internal controls, how we manage cash and the educational background of our financial back-office employees… They also wanted to know about our human capital policies, like securities trading and MOREDan Primack - May 9, 2011 5:00 AM ET
The rule of private equity fundraising in 2011 is that it's a long, long slog. Research firm Preqin recently reported that the typical process now spans 18 months, up from just around 12 months before the credit crisis. But, like with any rule, there are exceptions.
One of those is GTCR, which Fortune learned has closed its 10th fund after less than eight months in market. The Chicago-based firm began fundraising MOREDan Primack - Feb 22, 2011 9:55 AM ET
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