Barbon Insurance Group, trading as HomeLet and Rentshield Direct, and Let Alliance have today (6th November) announced a merger, creating a highly skilled and resilient strategic supply partner to professional letting agents.
Operating under the name of Barbon Holdings Limited, the combined businesses will offer the widest portfolio of protection solutions and ancillary services to letting agents and their landlords.
The businesses will continue to trade separately under their respective brands.
Martin Totty remains as group chief executive of Barbon Holdings Limited and Andy Halstead maintains his role as chief executive at Let Alliance. As part of the merger, Halstead will also assume an executive director position on the Barbon Group board, subject to regulatory approval.
The merger comes at a pivotal time within the rental sector, following the introduction of the Tenant Fees Act in June, which has challenged the traditional business model.
The merger means that the well-established Barbon Holdings will be able to re-invest a greater share from cash flows behind innovation, rather than into the running costs of the business or looking elsewhere for capital which has supported other recent startup ventures in the sector.
Martin Totty said: “Bringing the two organisations together will enable an increased investment into technology and product innovation, generating incremental income or lowering operating expenses. It is a prerequisite that we will constantly look for opportunities to develop our proposition and enhance our customers’ businesses.
“Our market is changing and the needs of customers will change as a result, he said. Customers need solutions that protect, help generate income and can be embedded into their own propositions.”
Martin added: “Letting agents and their landlords are looking for peace of mind that strategic supply partners deliver quality and value, are financially resilient, well capitalised and with balance sheet strength to meet future liabilities on products and services they sell today where customers may have use of them much later.
“We also recognise that customers can no longer afford the time or resources required in conducting risk assessments and due diligence on the viability of small firms with limited solutions.
“Combining the robust and longstanding Barbon business with the creativity and breadth of product portfolio of Let Alliance - both with deep experience in regulated financial services - creates a scale provider of lettings protection solutions that has the potential to invest and innovate better than if the brands remained independent.”
Founder and chief executive of Let Alliance Andy Halstead said: “We have built a very special business at Let Alliance. Customers are at the heart of everything we do. Our merger with HomeLet and Rentshield is consistent with our values; it’s all about our customers.
“Letting agents across the UK are working in a tough and challenging market. Letting agents are consolidating and local firms are merging in order to build scale and thrive in the future. Strategic partners and suppliers like us need to understand the needs and challenges that letting agents experience and consider how they provide support and solutions.
“The merger allows us to focus all our combined resources on further developing our proposition for customers. We are ‘fit for the future’ and have the financial strength to deliver exactly what our customers need. The world just got a whole lot better for letting agents: the next phase of our journey together will be exciting and seriously valuable for customers.
“The merger gives us access to resources that we could only dream of as an independent and it gives us the scope to carry on as Let Alliance and remain true to our values and customer commitments.”
Barbon Holdings Limited is majority owned by The Carlyle Group, an international alternative asset investor.
Michael Savage, director of The Carlyle Group said: “We have worked with the Barbon management team for more than four years now. During that period we have got to know the sector well and believe the prospects for the private rented segment are very positive.
“The opportunity here for us to invest further behind two great businesses, both with strong cultures and experience of managing in a regulated environment, where technical skills and a customer orientation are critical for success, was not one we were willing to pass up and are delighted to support the management teams as they take the combined business forward into the next phase.”