Hanna?s Growing Galaxy: Focus Mexico with a Possible U.S. Buy

A former leader of Worldwide Asset Management last week purchased a Mexican-based collections agency with plans to leverage its growth in Mexico, Latin America and the U.S., believes debt prices could drop 25 percent and is looking at further acquisitions.

Tye Hanna created Atlanta-based Galaxy Asset Management recently to return to purchasing domestic and international distressed consumer receivables, with a focus on credit card debt. Hanna told insideARM that he bought International Risk Management (“IRM”), in Guadalajara, Mexico, to serve the Spanish-speaking market in Mexico and Latin America (“Galaxy Buys Hispanic Collection Agency,” Jan. 16).

“I like the Mexican market. I know the IRM management team,” said Hanna of Juan Blanco, its CEO and president. Hanna worked with Blanco at Worldwide where Blanco ran international operations. In 2004, West Corp. bought Worldwide, and renamed it West Asset Management or WAM. In 2006, Blanco bought IRM from West. Hanna left WAM early last year.

IRM has 160 employees in its call center in Guadalajara and operates offices in Las Vegas and Norcross, Georgia. Last year, it spent about $12 million purchasing Mexican consumer debt, primarily of credit card portfolios, Hanna said. He and Blanco plan to sped $15 million to $20 million this year on Mexican consumer debt, and grow the call center to as many as 250 seats.

While the near term focus is Mexico, there are plans to move beyond that, said Hanna. ‘We want to use (IRM) to establish our own U.S. contingent business and to expand in Latin America,” he said, noting that IRM already calls Spanish-speaking accounts in the U.S. on a contingent basis.

Hanna said Galaxy will be “running hard in the third quarter,” after some gearing up in the next six months.

Timing for the expansion could be right as the price of debt has been on the decline.

“We’ve seen it drop 20 percent to 25 percent. I believe if it came down another 25 percent it would be (closer to historic levels),” said Hanna. “You can’t make money if its 12 cents to 13 cents (on the dollar). If you get to 9 cents, it starts to get attractive.”

That decline could occur as buyers take into account the economic difficulties faced by the U.S. consumer, Hanna believes. There’s money to be made, but buyers must be disciplined.

Meanwhile, Hanna and his team, which includes Ken Hurt, another Worldwide alumnus, are considering the purchase of a U.S. firm or two to further establish Galaxy’s operations. “We are looking for acquisitions to do that. I’m not sure if we should (build our own) or do acquisitions. We’re looking at several opportunities,” Hanna said.