The deal isn’t done yet but that could change as early as later today. It seems that Tungsten, an investment vehicle established by Edmund Truell, founder of private equity firm Duke Street Capital, has OB10 in it sights as part of a strategy to acquire financial services businesses such as banks, asset managers and insurers, in north-west Europe.
Quoted in the FT yesterday Mr Truell explained. “We want to disrupt the supply-chain finance market. The opportunity to grow this is vast,” he claimed.
According to the FT, Tungsten is also aiming to acquire the UK arm of First International Bank of Israel, which will give it a UK banking licence subject to regulatory approval.
It is early days in this deal and we’ll see in the coming days what the implications are but already, it’s possible to draw some tentative conclusions about what is going on here.
The perfect storm – the combination of economic factors like zero interest rates constrained liquidity exacerbated by increased regulatory requirements imposed on banks – hasn’t gone away. The urgent need for businesses to secure cost effective working capital has been crying out for new approaches. Technology enables supply chain finance is one such solution.
I’ve often made the point that there is a powerful potential synergy between e-invoicing and lending that the banks have failed – for all kinds of reasons – to capitalize upon. Now it seems the synergy might be delivered.
Pete Loughlin can be found on twitter @peteloughlin