An agreement has been reached for a Manchester-headquartered credit management services provider to be bought by a private equity firm, which helped the billionaire brothers behind EG Group acquire Asda.
Arrow Global received a preliminary, conditional proposal from TDR Capital on February 8 for a possible cash offer of 305 pence per share for the entire issued and to be issued ordinary share capital.
On February 22, TDR Capital made a revised proposal of 307.5 pence per share in cash, and revealed earlier this month, which has now been accepted.
The acquisition values Arrow's entire issued, and to be issued, ordinary share capital at approximately £563m.
The move from TDR Capital comes after is partnered with EG Group's Zuber and Mohsin Issa to complete a £6.8bn deal for Asda.
The firm also has investments in the likes of David Lloyd Leisure, Keepmoat Homes and Stonegate Pub Company.
It has previously backed Pizza Express, Lowell Group and International Car Wash Group.
Arrow chairman Jonathan Bloomer said: "Arrow is a great company and, over the past two years, has taken significant and successful steps in its journey to becoming a fully integrated asset manager.
"In November 2020, in response to an increasingly attractive operating environment, the leadership team set out an accelerated strategy to enable Arrow to grow funds under management and increase capital light earnings while at the same time deleveraging. This strategy was well received by our clients, customers and investors, and is fully supported by TDR Capital.
"Having considered in detail the opportunities and risks involved in implementing this strategy, and particularly in growing the fund management business, the Arrow board has concluded that the acquisition, which offers certain cash value to Arrow's shareholders, is in the best interests of Arrow's shareholders.
"I am proud to have been chair of Arrow for the last seven years and it has been a pleasure to work with so many dedicated individuals who have made Arrow a leading European investor and asset manager in the non-performing and non-core assets sector.
"For now, it is business as usual, and I thank all our people for their continued dedication and hard work."
Jonathan Rosen of TDR Capital added: "Arrow is a company that we have followed for some time, and the company's position as a clear market leader is due to the strength of the team they have built.
"We are excited to partner with them to accelerate their strategy to build a market leading fund management business by providing the investment and support needed, all of which we believe is better facilitated as a private company."
The Arrow directors have been advised by Goldman Sachs, J.P. Morgan Cazenove and Numis on the financial terms of the cash offer.
The company was founded in 2005 and floated on the London Stock Exchange in 2013.
TDR Capital was formed in 2002 and is based in London with over €8bn of committed capital.
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