Blackstone takes on La Trobe Financial in mortgage market buyout

Melbourne-based La Trobe Financial, one of the largest non-bank lenders in the country, has struck a deal with Blackstone, a New York-based private equity company.

Blackstone has taken an 80% stake in the privately-owned firm for an undisclosed sum. 

Chief executive Greg O'Neill will retain 20% ownership and continue in his role at the 65 year old lending institution.

O'Neill said the opportunity for La Trobe to partner with Blackstone was the perfect fit for staff, customers and the business.

"The specialist credit space is experiencing a defining period of change and growth around the world right now and it is critical that we continue to build on our strong capital position, expand our networks and draw on global best practice," he said.

Australian Broker noted La Trobe Financial manages investment mandates in excess of A$13 billion, including a retail Credit Fund of almost $2 billion and over $1 billion of public RMBS bonds issued.

Currently La Trobe has over 200 staff with offices in Melbourne, Sydney, Shanghai and Hong Kong.

The AFR says Australia's $1.7 trillion mortgage market has become a hotspot for global private equity titans with more buyout funds tipped to follow Blackstone and KKR's recent forays into the shadow banking sector. 

The La Trobe deal follows the $675 million takeover of listed non-bank lender Pepper by KKR earlier this month.