MM thoughts on CLH
“Can I have your thoughts on Collection House (CLH) please after their numerous recent announcements.” - Thanks Ian C.
The Latest Q&A
Answer
Morning Ian,
Credit management agency CLH has become a $50m business having been suspended since last February before coming back on the market early January at a fraction of the price.
The woes of CLH came down to too much debt and when regulators targeted their aggressive collection tactics it forced them to rejig their assumptions on the debt’s they owned i.e. lower collections and that change prompted their lenders to call in loans and the house of cards began to crack.
The company has two divisions, one that buys debt ledgers and collects on those and a division that collects for others and simply earns a fee for doing do. To get back on their feet, they’ve largely sold their purchased debt ledger (PDLs) in Australia and will now primarily operate as a contract collector while they try to grow their PDL business over time. It will be a long road back for CLH given the strength of competitors like Credit Corp (CCP), but at least they survived and there is hope.
MM is neutral CLH at best
Add To Hit List
