Pepper announced the deal late on Friday with the lender acquiring Optimum Credit’s entire business, including a second charge loan book of more than £450m.
Cardiff-based Optimum Credit was launched in 2014 and is currently owned by Patron Capital, with the deal remaining subject to regulatory approval.
Pepper Money told Specialist Lending Solutions: “As part of the purchase, we will be reviewing options for how Optimum is incorporated within the Pepper family.
“All Pepper-owned businesses trade under the Pepper brand, so we expect Optimum will transition to a Pepper brand in time.”
Brokers welcome deal
Brilliant Solutions managing director Matthew Arena (pictured) said the deal was great news.
“Pepper excels in specialist lending but has seen fit to purchase an existing operation which shows an acknowledgement that secured loans requires a unique skill-set and distribution base,” he said.
“Pepper’s own expertise will only add to the existing Optimum business.”
This was echoed by Brightstar Financial CEO Rob Jupp, who agreed it was a positive move for the second charge market.
“Pepper has quickly established a leading brand in specialist first charge lending and has announced its exciting plans to become a bank,” he said.
“It’s one to watch for the future and it’s fantastic that it sees second charge mortgages as a core part of its proposition.”
Kevin Hindley, CEO of Fluent Money Group, added it had built a close relationship with the directors and staff of Optimum and was pleased with the news.
“Pepper Money’s purchase of the business will ensure that Optimum Credit will become an even more significant leader in the second charge sector.
“They have represented the second charge sector with distinction and the purchase is a testament to their dedication to what is best for the industry and their customers.”