Affinity Equity Partners has initiated a major sale process for its non-bank lender, Scottish Pacific (ScotPac), with expectations of exceeding $1 billion. This announcement comes shortly after the company reported a pre-tax profit of $100 million and highlighted its growth trajectory in the competitive lending market, particularly aimed at small and medium-sized enterprises (SMEs).
The move to sell ScotPac is set to become one of the most significant financial transactions of 2026, particularly given ScotPac’s substantial loan book of $3 billion and its extensive network of over 2,000 brokers. Interested investors, who requested anonymity, indicated that the formal sale process is expected to launch in early 2026. This follows a year of growing interest from both financial investors and strategic players.
Investor education materials are being distributed, portraying ScotPac as a “high-quality, technology-enabled credit platform.” The company claims to maintain a “hard-to-replicate competitive moat across Australia and New Zealand,” under the leadership of chief executive Jon Sutton, a former head of the Bank of Queensland. ScotPac’s diverse product offerings include working capital solutions, asset finance, and property finance, catering to more than 9,000 business customers.
In terms of profitability, ScotPac generates over $100 million in pre-tax profit, with approximately 60 percent of its net profit after tax stemming from working capital solutions. Asset finance contributes 25 percent, while business lending and property finance round out its revenue sources. The company has achieved a double-digit revenue compound annual growth rate over the past five years, and it boasts a loss rate of below 1 percent.
Affinity Equity acquired ScotPac in 2018 for $612 million and refinanced its debt last year with support from Bain Capital Credit, IFM Investors, and MA Financial. The decision to sell comes at a time when non-bank lenders are actively entering the market, as evidenced by Brookfield’s proposed $2.5 billion sale of La Trobe and offers from industry figures such as Humm’s founder Andrew Abercrombie.
The appetite for private credit and SME lending is strengthening, driven by stable funding conditions and attractive yield profiles. In its sell-side pitch, UBS has highlighted that SME lending is among the most desirable segments within the Australian credit market, as businesses increasingly turn to non-bank options for faster and more agile financing solutions.
As the sale process unfolds, ScotPac’s established presence in the market and its robust financial performance position it as a compelling opportunity for potential buyers looking to capitalize on the growing demand for non-bank lending in Australia and New Zealand.
