Activist investor Elliott Investment Management has built a sizable position in Enra Specialist Finance, after acquiring a majority stake in the business, subject to FCA approval.

Elliott is acquiring its stake from management and Exponent Private Equity which has owned Enra for five-years and is now exiting its ownership position completely.

The transaction confirmed today is the culmination of a competitive process that moved extremely quickly and saw several global investment companies competing to acquire Enra.

Danny Waters, Enra’s founder and CEO, said: “In Elliott we have found a partner that has deep experience in the UK mortgage market, and the ambition to support Enra’s continuing growth as the pre-eminent specialist lending business in the UK.

“Their desire to acquire Enra is a great validation of the business we have built over the last nineteen years, and a huge vote of confidence in the strength of our future business plans. This will be Enra’s third private equity transaction in the last 10 years and our continuing success has been made possible through the hard work of my team at Enra.

“2021 was a record year for Enra in terms of gross lending and overall financial performance, and in the last eighteen months we have upsized our warehouse funding capacity, issued our second securitisation, and we have now sourced a new equity partner to support the business for years to come. This puts Enra is a fantastic position to further develop its lending and broking businesses. I would like to thank Exponent for their support over the last few years, and I look forward very much to leading the business to further success in partnership with the Elliott team.”

Mark Taylor from Exponent Private Equity commented: “It has been a privilege to partner with Danny Waters and his team. Since we backed in Enra in 2017 the business has grown into the leading non-bank mortgage lender in the UK, underpinned by its best-in-class distribution, credit performance and growth. We are delighted with the outcome and are confident Enra will continue to thrive with Elliott Advisors’ backing.”

Amit Sharma and Richard Monahan from Elliott will join the Board at Enra.

Monahan added: “We have been active investors in the UK lending market for many years with stakes in businesses such as Charter Court Financial Services and OneSavings Bank. Enra is a stand-out performer in a crowded marketplace with the size, experience, funding capacity, and leadership to deliver continuing success.

“In the last five years we have seen Enra expand rapidly from Bridging Loans into Development Finance, Second Charge lending and most recently specialist Buy-to-Let, and we recognise a business that has the capacity to deliver further significant growth at attractive levels of risk-adjusted return.

“Danny has built a business that is able to write tightly controlled credit risk at attractive margins across several different products to deliver significant profit growth. Taken together this represents an extremely compelling investment case. We look forward to working with Danny and the Enra team in the coming years to support the continued growth of the business.”