Milestone Partners, St. David's, has bought control of a 41-branch loan company, specializing in borrowers with damaged credit, from troubled 1st Mariner Bancorp of Baltimore, of Baltimore, which is under FDIC orders to raise more capital, for $10 million in cash and a piece of the future action.

Mariner Finance targets borrowers who are "creditworthy, but not creditworthy enough to walk into TD Bank and get a loan at a single-digit interest rate," Milestone partner Adam Curtin told me. He said they tend to have Fico scores (a credit-rating system developed by Fair, Isaac & Co.) of around 600, compared to bank customers who typically boast 700 or better.

Mariner Finance employs around 250 at offices in Delaware, Maryland, New Jersey, Tennessee and Virginia. The company has no branches in Philadelphia or neighboring Pennsylvania counties; its nearest offices are in Wyomissing, Pa.; Turnersville, N.J.; and Bear, Del.

Curtin said Milestone, which raised $240 million from investors for its Milestone Partners III fund earlier this year, is looking for other lenders to combine with Mariner Finance, as troubled banks sell assets to raise capital to satisfy government regulators they're not in danger of going under.

Janney Montgomery Scott of Philadlephia advised 1st Mariner on the deal. The sale price includes $8.9 million up front, $1.1 million to be paid from an escrow account after 18 months.

Also, 1st Mariner retains 5 percent of the company, a stake the companies valued at $700,000.