Kensington Mortgages faces break in £1bn sale: Sky

Kensington Mortgages could be split as five companies fight to buy the £1bn valued specialist lender, according to Sky News.

It says challenger lender Starling Bank is bidding against Barclays and another high street lender to buy the Kensington platform, while rival investment houses Pimco and M&G Investments are battling to buy the company’s mortgage assets .

Kensington, which specializes in loans to the self-employed and over 55s, was given formal notice last November by its owners of the American investment group Blackstone and Sixth Street.

An auction for the lender led by Wall Street bank Morgan Stanley is expected to lead to two separate transactions, according to the report.

The combined total of the two sales is expected to reach £1 billion.

Blackstone and private equity firm TPG bought Kensington for an undisclosed sum from South African bank Investec in 2014. Sixth Street was previously part of TPG.

Kensington is one of the biggest issuers of residential mortgage-backed securities, selling a £452m package of house loans to capital markets in November.

It was the lender’s third securitization last year, taking total funds raised to £13.4bn in 24 deals since 2015.

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