TransUnion Buys CIFIN: Colombian Credit Bureau
US based credit reporting agency TransUnion (NYSE: TRU) has acquired a 71% ownership interest in Central de Informacion Financiera (CIFIN), one of two primary Colombian credit bureaus; the other being DataCrédito, already owned by TransUnion competitor Experian. In addition to its US operations, TransUnion operates in several high-growth countries around the globe ranging from the Philippines to India to Mexico, as well as other Latin American countries.
“TransUnion’s growth strategy focuses on international expansion in emerging markets, and Latin America is a key region of focus. We are delighted to add Colombia to our family of 10 other Latin American markets and look forward to leveraging our global data, analytics and technology capabilities for the benefit of Colombian banks, businesses and consumers,” said Jim Peck, TransUnion’s president and chief executive officer in a statement.
CIFIN was established 35 years ago and covers both positive and negative data on consumer behavior, in an attempt to give lenders a complete consumer profile on possible borrowers.
“CIFIN is a great company in an attractive market with a long and successful history of using data to deliver differentiated insights to customers,” said David Neenan, president of TransUnion’s International business. “In line with TransUnion’s growth strategy, we identified CIFIN as an opportunity for acquisition several years ago, and the time is right now. Joining forces with CIFIN is a terrific opportunity to leverage our global operating model and technology platform to accelerate performance.”
CIFIN offers a wide portfolio of products and services for Colombian consumers and customers across multiple industries, including financial services, insurance, telecommunications, retail and manufacturing. TransUnion plans to introduce advanced analytics, decision support solutions, an enhanced direct-to-consumer platform, and expansion into adjacent industries such as insurance.
“CIFIN’s customers have a strong appetite for new solutions proven in markets around the globe,” said Maria Olga Rehbein, TransUnion’s regional president in Latin America. “As the Colombian economy grows, we are well positioned to help businesses manage risk and consumers access the services that lead to a higher quality of life.”
This acquisition adds to TransUnion’s Latin America portfolio, where the company already has a presence in Brazil, Chile and Mexico as well as Central America. The largest Colombian banks such as Bancolombia have been investing significantly in Central America, and TransUnion has indicated that it will leverage its regional footprint to support their expansion.
TransUnion acquired its initial 71% ownership interest at a price of $426 billion COP (approximately $127 million USD) on February 8, financed through its revolving credit facility. The agency expects to acquire the remaining shares through the rest of 2016, including a small portion following the conclusion of certain mandatory regulatory processes. CIFIN was previously jointly owned by Colombia’s major banks, who have agreed to remain customers of the acquired agency.
Inverlink served as adviser to TransUnion on the transaction.