Financier Steve HudsonJ.P. MOCZULSKI/The Globe and Mail
Financier Steve Hudson is adding to his new venture a key member of the team that fuelled the fast growth of his first multi-billion company, Newcourt Credit Group.
Mr. Hudson's Element Financial Corp. said early Monday that Bradley Nullmeyer is joining as a senior executive who will lead the company's expansion into vendor finance.
It was vendor finance that really drove the growth at Newcourt, bringing in most of the company's assets by the mid-1990s as Newcourt set up programs for huge manufacturers such as Dell Computer.
If Element can pull off something similar, the addition of Mr. Nullmeyer could mark a new shift to faster growth at Mr. Hudson's newest company.
Mr. Nullmeyer, who has been working on other ventures in recent years, buys into Mr. Hudson's thesis that there's a void in the market left by the retreat of other financial firms in the wake of the credit crisis. At the same time, the manufacturing sector is seeing signs of a rebound, creating an opportunity to do financing for firms that want their clients to be able to buy products on credit.
"What's happening now is the resurgence of manufacturing and retooling, and the lack of competitors in the marketplace that I see that provide this type of product," he said in an interview. "There's a really phenomenal opportunity right now to do similar kinds of things that we did in Newcourt."
There's also an opportunity based on new accounting rules that make it more punitive for companies to do their own financing for clients, he said.
Mr. Hudson said that Mr. Nullmeyer, who built a $30-billion vendor finance operation at Newcourt, should be able to get Element to to the "$5-billion to $10-range easily. Easily."
That will require increased funding, but Mr. Hudson said that Element's backers at life insurance companies and banks are ready to step up. For example, the company is increasing its credit line to $750-million from $500-million.
In addition, Element is trying to add pension plans to its roster of funding sources, he said.