Winnipeg leasing company sees assets grow to $2.5B

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This article was published 31/10/2017 (2934 days ago), so information in it may no longer be current.

Winnipeg equipment-leasing specialist National Leasing is about to get a $650-million shot in the arm after its parent company signed a deal to acquire the equipment financing and leasing assets of a Toronto-based commercial finance company.

CWB Financial Group’s acquisition of the equipment finance and leasing assets of ECN Commercial and Vendor Finance Canada for an undisclosed sum will boost National Leasing’s asset portfolio by 35 per cent, or $650 million, to about $2.5 billion.

It will also pave the way for the company to add another 15 to 20 workers to its approximately 370-member head-office staff over the next six to nine months.

Although the ECN deal isn’t scheduled to close until Jan. 31, National Leasing has already begun laying the groundwork that will enable it to hit the ground running on Feb. 1.

“We’re gearing up right now,” president and CEO Tom Pundyk said Tuesday. “We’re in full tilt, finding people, getting our systems ready, (and) figuring out how to pass over the information from their firm to ours.”

The new hires will be primarily for the company’s information technology (IT), project management, customer service and collections operations.

Pundyk said one of the things that makes National Leasing unique is that it develops all of its software and IT systems in-house. Its IT department, which is its largest department, has between 80 and 85 employees working on software development.

The announcement of the ECN deal, which is the largest in National Leasing’s 40-year history, came on the final day of what has been a record-breaking fiscal year for the company. It was the first time its annual sales topped the $900-million threshold.

Pundyk said it was Edmonton-based Canadian Western Bank’s acquisition of the company that enabled National Leasing it to take its business to a new level.

“We had assets of about $500 million in 2010 when they bought us, and we will be five times that size once this deal is completed,” he noted. “The reason we’ve grown like that is because we had this $500-million company that had all of the systems, people and processes. All we needed was better capital. Once we had that, we had everything in place, and it allowed us to get into markets where we couldn’t be competitive until we made this deal with Canadian Western Bank.”

CWB president and CEO Chris Fowler described the ECN deal as “a highly accretive and strategic portfolio acquisition for CWB, and an excellent capital deployment opportunity.”

Fowler said the newly acquired client base is a good fit with CWB’s strategic priorities, and provides it with valuable prospects to pursue future growth.

“With approximately 75 per cent of the (ECN) portfolio originated outside of Western Canada, this will also move us toward our strategic goal to grow CWB’s Ontario exposures to a third of our total,” he said.

He noted the ECN portfolio has a relatively short, approximately two-year weighted average duration.

“As such, the magnitude of the impact will depend on our ability to quickly leverage the growth opportunities available to us,” he added. “We’re confident that our strong teams will continue to build on the quality relationships previously established by ECN.”

The newly-acquired portfolio is primarily comprised of loans and leases within the transportation, construction and healthcare industries. CWB estimates the balance of acquired loans and leases will be worth approximately $900 million when the deal closes.

Pundyk said National Leasing will have between 70,000 and 80,000 customers in Canada once the deal is finalized. The products it leases to its customers include agriculture, construction, transportation, medical, golf and landscaping, industrial and material handling, and office and telecommunications equipment.

murray.mcneill@freepress.mb.ca