£1.3bn acquisition target’s shares soar while predator firm’s fall as takeover bid collapses
The company behind a hostile bid to acquire doorstep lender Provident Financial in a £1.3bn takeover battle saw its shares fall more than 10% yesterday after the news broke it was pulling the plug on the deal.
Non-Standard Finance’s shares closed last night at 42.1p, down 10.2%, while Provident shares jumped 9% as markets opened but were up more than 16% by lunchtime trading, jumping 72p to 519p. They closed at 517p, up 16%.
John van Kuffeler, boss Non-Standard Finance (NSF) and a former chief executive of Provident, launched the £1.3bn battle for his former employer in February.
However, yesterday NSF dropped its bid for the UK’s largest payday lender, saying its offer would lapse as the regulatory condition would not be satisfied by the deadline.
A string of investors in Provident came out against NSF’s bid, the latest being Janus Henderson, which owns 1.3% of its shares.
Henderson followed Aberdeen Standard Investments, Schroders, Coltrane Asset Management and M&G Investments in rejecting the bid.
The group collectively own just under 25% of Provident’s shares. NSF would have required the support of 75% of Provident’s shareholders to delist it from the London Stock Exchange.
Meanwhile, the UK’s Competition and Markets Authority (CMA) recently raised questions over the proposed deal, saying that it was considering whether a merger of the two would result in a substantial lessening of competition.
