Sector developments and company hires

AGs fight Madden rule
The attorneys general of California, Illinois and New York have filed a suit against the OCC’s ‘valid when made’ rule (SCI 1 June), which they claim would allow the federal government to pre-empt state usury laws and allow third-party entities “to prey on vulnerable” borrowers. The AGs note that the ability to pre-empt state usury laws is a privilege granted to national banks because they are subject to extensive federal oversight and supervision. Further, they argue that this privilege is valuable to national banks because it permits them to lend money at rates that far exceed the rates they already pay to borrow money. The lawsuit asks the court to declare the rule unlawful and to set it aside - arguing that the OCC has exceeded its authority under the National Bank Act and the Dodd-Frank Act, in violation of the Administrative Procedure Act. 

In other news…

Acquisitions
Azimut Group, via its US subsidiary Azimut Alternative Capital Partners (AACP), is set to acquire a minority equity interest in Kennedy Lewis Investment Management and certain affiliated entities. AACP was established in November 2019 with the purpose of partnering with US-based alternative asset managers by providing them with permanent capital to grow and reach their business potential. The Kennedy Lewis deal is the first transaction completed by AACP and entails AACP acquiring a circa 20% equity interest as permanent capital in various Kennedy Lewis entities. The transaction also includes a mechanism for price adjustment. Azimut will consequently consolidate Kennedy Lewis’ AUM on a pro-rata basis and receive pro-rata distributions from Kennedy Lewis. Approximately 90% of proceeds from the transaction will be used to increase Kennedy Lewis’ investments in its own funds.

Enova International is set to acquire all outstanding shares of OnDeck in a cash and stock transaction valued at approximately US$90m. The implied price of US$1.38 per OnDeck share reflects a 3.6% premium to its 90-day volume weighted average price and a 90.4% premium based on the closing price of US$0.73 per OnDeck share on 27 July. This transaction brings together two complementary businesses across consumer and small business online lending. Enova will add the OnDeck brand, products and services to its existing portfolio to create a combined company with significant scale and diverse product offerings. Together, the two platforms had US$4.7bn in originations in 2019 and have served approximately seven million customers.

CMBS data offered
Property intelligence provider Reonomy has enhanced its platform with CMBS data, which aims to allow users to easily identify refinance opportunities, view CMBS ongoing financial and loan reporting and access increased coverage of property data points. The enhancement provides data on over 150,000 properties and over 300,000 mortgages in the US, including ongoing financial reporting for properties and loans, and information on current balance and delinquency status.

EMEA
Deutsche Bank has appointed Colin Parkhill as head of European ABS and CLO syndication. He will join the firm in the Autumn and report to John O’Connell, head of global credit trading syndicate. Parkhill was previously head of the European ABS syndicate desk at Lloyds Bank.