CIT to acquire technology-driven lender Direct Capital
25 June 2014
CIT Bank, the US commercial bank subsidiary of CIT Group Inc, a leading provider of commercial lending, leasing and advisory services, has entered into an agreement to acquire Portsmouth, New Hampshire-based Direct Capital Corporation, a provider of financing to small and mid-sized businesses.
CIT said the transaction will expand its small business and middle market lending and equipment leasing capabilities while allowing Direct Capital to offer CIT's broad range of products and services to its customers. It did not reveal the cost of the transaction.
After the acquisition, Christopher J Broom, co-founder and chairman of Direct Capital, and James P Broom, chief executive of Direct Capital, will continue to head the business.
The acquisition is expected to close in the third quarter following the satisfaction of regulatory requirements and contractual conditions to closing. Terms of the agreement were not disclosed.
''Through its customer-centric approach and unique value-added technology platform, Direct Capital has established itself as a leader in providing small and mid-sized businesses fast, flexible and affordable financing,'' said Nelson J Chai, president of CIT Group Inc and chairman and CEO of CIT Bank. ''Direct Capital's proprietary online lending platform, LendEdge, will complement our existing small business and mid-market customer offerings as we continue to provide financing to these important sectors of the US economy.''
Since its founding in 1993, Direct Capital has provided more than 80,000 small and mid-sized businesses over $2.25 billion in equipment, franchise and vendor financing and lending solutions to grow their businesses. Direct Capital has assets of approximately $500 million and employs 250 individuals. In 2013, it was named to the Inc 500/5000 and Monitor 100 lists of top growth companies.
Christopher Broom said, ''We are excited to join the CIT family, which will allow us the opportunity to build upon our established business model of providing small and mid-sized businesses access to the capital they need to grow and prosper. CIT understands the importance of customer service and has built a reputation over the past 100 years of serving these sectors.''
Direct Capital is a financial technology company that delivers financial solutions for small and medium sized businesses, franchisors, and equipment and technology sellers. The company is headquartered in Portsmouth, NH and operates offices in New York, California, and Georgia.
Founded in 2000, CIT Bank, a member of FDIC, Equal Housing Lender, is the US commercial bank subsidiary of CIT Group Inc. It provides lending and leasing to the small business, middle market and transportation sectors.
As of 31 March 2014, it had over $13 billion of deposits and more than $16.5 billion of assets.