Mortgage broker John Charcol puts itself up for sale after several approaches

(Update adds CEO, adviser comments) Mortgage broker John Charcol has been put up for sale by its private equity backers, with a price tag thought to be about £50 million, after receiving a number of approaches.

The approaches come during a difficult time for the mortgage market, with lending predicted to fall drastically next year in the wake of the credit crunch.

But John Charcol chief executive Ian Kennedy claimed that it was looking to sell up from a position of strength, arguing that the broker was benefiting from a demand for advice in uncertain economic conditions.

‘Because of the credit crunch, it’s more difficult to get the right mortgage as a consumer so people are more inclined to seek advice, and we are best placed to pick up more than our fair share of that,’ he said, arguing that it was benefiting from client brand recognition.

Kennedy argued that larger brokers like John Charcol, with access to a wider expertise and with better links to lenders, were better placed to find mortgages for their clients despite the difficulties imposed by the credit squeeze.

The company has appointed investment bank Gleacher Shacklock to review its financing and ownership options. An information memorandum is to be sent to prospective bidders in the next two weeks.

An auction of John Charcol is expected to attract US and European bidders looking to enter the UK.

The firm could also be attractive for web-based mortgage aggregators, lenders looking to establish distribution channels or life and general insurance providers, Kennedy claimed.

He said the broker had received approaches in Q4 last year from companies involved in different areas of the market, leading to a review of the firm’s ownership.

‘Given the expressions of interest, we are pleased to pursue them and see if they offer fair value,’ he said.