Foreign Currency Provider Moneycorp Eyes Sale

One of the UK's fastest-growing foreign exchange providers is being put up for sale with a price tag expected to value it at hundreds of millions of pounds.

Sky News understands that TTT Moneycorp, which operates nearly 80 retail outlets in airports and other travel destinations, is to be auctioned at the same time as Travelex, one of its main rivals, prepares for a stock market flotation.

Canaccord Genuity (Other OTC: CCORF - news) , the investment bank, is understood to have been appointed to handle the sale of Moneycorp.

The payments specialist's owner is a vehicle which until recently was managed by the taxpayer-backed Royal Bank of Scotland (LSE: RBS.L - news) (RBS).

Called the RBS Special Opportunities Fund (SOF) until its separation from the bank, its management is said to have decided to explore options that would realise value for investors.

Founded in 1999 at a shop on Oxford Street in London's West End, Moneycorp now handles transactions worth more than £8bn annually and employs more than 500 people.

The company is run by Mark Horgan, a former Travelex and MasterCard executive.

Bankers said the decision to put Moneycorp up for sale was unsurprising given the recent changes at its principal shareholder.

The spin-off of the RBS-managed fund reflects a growing trend among global banks to downsize their investment businesses because of more punitive capital treatment by international regulators.

In RBS's case, the outsourcing of the vehicle is also a consequence of growing pressure from the Chancellor George Osborne to focus on consumer and small business lending.

RBS held a 13.5% direct stake in the SOF, which describes itself as "a discreet £1.1bn third-party fund" but which has provoked occasional controversy since the bank’s rescue in 2008 by continuing to make new investments.

The fund had been part of RBS's non-core division since 2008, and continues to own Target (NYSE: TGT - news) , a financial services outsourcing provider.

Under the management of Lindsey McMurray, SOF has been shrinking its portfolio of investments through a series of asset sales and flotations.

These have included the recent stock market listing of Arrow Global (LSE: ARW.L - news) , the debt collection agency which recently snapped up a £900m portfolio of student loans from the Government.

Among the other businesses it has been an investor in are Catalina, a Bermuda-based acquisition vehicle that is currently engaged in bidding for the insurance assets of the struggling Co-operative Group. RBS SOF sold its stake in Catalina to Apollo Management, another investment firm, earlier this year.

It was also a shareholder in Four Seasons, the nursing home group.

A Moneycorp spokeswoman declined to comment.

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