Edmonds Group arranges $30m subprime account purchase program
By SSN Staff
Updated Fri May 16, 2014
ST. LOUIS—The Edmonds Group in April announced the initial closing under a $30 million program to purchase subprime security alarm accounts from one of the nation's largest alarm companies. The buyer, a large alternate asset investing firm, will buy accounts with low credit scores and accounts with no credit score available. The seller will enter into a long-term agreement with the buyer to provide monitoring, billing and onsite service for the purchased customers. Neither party wished to be identified.
“This transaction provides an opportunity for the seller to lower their average cost of customer origination by accepting customers they would otherwise have turned away while avoiding the increase in their attrition rate they would experience by owning subprime customers,” Henry Edmonds, president and founder of The Edmonds Group, based here, said in a prepared statement. “From the buyer's perspective, by paying a price that that takes into account the expected higher attrition rate of subprime accounts, they expect to achieve an attractive return.”
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