Sectors > Top Reports > Intrum Memo 190424

Intrum Memo 190424

Intrum - Modelling Scenarios – Uptiering & Dropdown (Narrow & Holistic), Qualified Receivables Financing, Restructuring & Break-Up. Estimating Path To Servicing FY 26 Targets. Potential EBITDA Upside – Ophelos & Asset Management. Comparison vs DoValue
PUBLISHED: 19 April 2024
PAGES: 362
SUBMARKET: Intrum, Top Reports, Top Reports,


Why Read?

  • Understand each series of SUNs’ recoveries across scenarios and scenario probabilities – Uptiering & Dropdown (Narrow & Holistic), Qualified Receivables Financing, Restructuring & Break-Up
  • Understand possible path to Intrum’s FY 26 targets for its Servicing business. Estimating EBIT(DA) margins of servicing financial services claims vs industrial claims and unit economics per call agent of servicing financial services claims vs industrial claims. Estimating Servicing EBIT(DA) margin sensitivity to actual : estimated collections within Servicing
  • Understand likely market value range of Intrum’s remaining portfolios owned post sale of back book to Cerberus JV based on industry expert network-guided pricing parameters
  • Understand potential cash distributions to Intrum from 35% equity stake in Cerberus JV and net IRRs to Cerberus on its investment into part of Intrum’s back book
  • Understand magnitude of priming capacity. Total baskets for secured debt (for possible Uptiering Transaction) and for Restricted Payments / Permitted Investments (for possible Dropdown Transaction) estimated
  • Understand doValue’s performance (pure servicer focused on Southern Europe) and comparison vs Intrum’s Servicing business. Valuation implications for Intrum’s Servicing business from doValue and Spanish real estate servicer M&A transaction multiples for Southern Europe and Spain respectively and from broader universe of servicer M&A transaction multiples over past decade
  • Understand Potential EBITDA upside from Ophelos (acquired technology company with fully autonomous debt resolution platform) – staff cost savings potential and potential for increased Servicing collections
  • Understand Potential EBITDA upside from asset management
  • Understand Servicing ERC decay in Spain (in respect of RED NPLs and REO) and in Southern Europe

What’s New?

  • Scenario modelling – Uptiering & Dropdown (Narrow & Holistic), Qualified Receivables Financing, Restructuring & Break-Up
  • Financial projections, valuation and sensitivities – base, bear, bull cases

Questions Answered

  • How does Intrum’s Servicing business compare with doValue’s? Why has doValue’s servicing AUM declined whilst Intrum’s has increased?
  • How realistic is the illustrative EBITDA upside Intrum presented from its Ophelos acquisition and what critical assumptions are required to achieve this?
  • How sensitive are potential Asset Management EBITDA and Asset Management-Linked Servicing EBITDA to servicing fee rate, to fund sizes raise and to cost-to-collect on fund portfolios serviced?
  • How do we estimate a weighted average EV / EBITDA multiple for Intrum’s Servicing business, reflecting the very different structural dynamics across its geographic markets?
  • How have Spanish real estate servicers (competing with Intrum’s Solvia, Aktua and Haya servicing businesses in Spain) been performing? Comparison of Altamira (owned by doValue), Aliseda and Servihabitat vs Intrum-owned servicers in Spain
  • How have Servicing M&A transaction multiples evolved – Spanish real estate servicers vs European servicers broadly?
  • Which management team members have been buying Intrum shares, at what prices, when and how many shares have they purchased? How might this influence their assessment across capital structure options?
  • What EBITDA could Haya contribute to Intrum going forward?

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