By Joe Hoppe

Barclays PLC said Friday that it has agreed to acquire Kensington Mortgage Co. and a related portfolio of U.K. mortgages for around 2.3 billion pounds ($2.82 billion).

The London-based lender said it will acquire the specialist mortgage lender from companies controlled by funds managed by Blackstone Tactical Opportunities Advisors LLC., and funds affiliated with Sixth Street Partners LLC.

The transaction is subject to regulatory approval and is expected to complete late in the fourth quarter of the year or early in the first quarter of 2023.

The consideration payable is expected to be around GBP2.3 billion, assuming the purchase completes in December and the KMC mortgage portfolio comprises around GBP2.0 billion. The portfolio totaled GBP1.2 billion as of May 31.

The transaction will be financed from existing resources and is estimated to reduce Barclay's common equity Tier 1 ratio--a key measure of balance-sheet strength--by around 12 basis points.

KMC generated a pretax profit of GBP500,000 in fiscal 2021, along with GBP65.9 million of income. Barclays said the acquisition will enable it to broaden its product offering and capabilities in the U.K. mortgage market, extend its customer base and grow mortgage originations.

Write to Joe Hoppe at joseph.hoppe@wsj.com

(END) Dow Jones Newswires

June 24, 2022 02:34 ET (06:34 GMT)

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