Superannuation and fund administration company Link Group is expanding its presence in the loan servicing market, announcing that it will acquire Pepper European Servicing.The Pepper business, which has €40 billion of assets under management, will be integrated with Link's banking and credit management division. Pepper European Servicing provides loan servicing, advisory and asset management services. It has operations in the United Kingdom, Ireland, Spain, Greece and Cyprus.Link's banking and credit management division provides loan servicing, underwriting and origination, structured finance and portfolio management services. It is currently servicing €90 billion of loan portfolios. It has operations in the UK, Ireland, Netherlands and Italy.The deal is worth €165 million in cash upfront, with a further €35 million contingent on performance over three years.Link said in an investor presentation that outsourcing of bank services was a growing trend in Europe and the acquisition would make it a "scale player".It said the UK and Irish businesses of the two companies were complementary and the merger would not result in cannibalisation.It said it was also exploring the Indian and Chinese markets.The combined businesses will have revenue of €198 million and operating EBITDA of €54 million.