Provident Financial in £3.1m CEL sale
LENDER Provident Financial has sold its cheque cashing and money remittance business Cheque Exchange Limited (CEL) for £3.1m.
The business has been bought by Hertford International Group, a holding company for subsidiaries including CrewCard Network, a marketer of pre-paid debit card programmes.
CEL provides either cheque cashing or money transfer facilities or in some cases both services through a network of 750 agents.
The acquisition from Bradford-based Provident, which specialises in loans to lower income households and those with poor credit histories, constituted a reverse take-over under AIM rules.
Hertford, which is registered in Surrey but trades out of London, said the purchase provided it with “an established operational infrastructure, a sales force, and positive cash-flow”.
“It also presents the opportunity to reduce the cost of some currently outsourced services and will enable the company to acquire a distribution network which will be utilised to sell existing and other planned Hertford products and services,” Hertford said.
As part of the deal, Hertford has signed, subject to successful completion of a pilot currently being run, a three year agreement, to be the exclusive provider of door-to-door cheque cashing services through the Provident network.
Hertford believes the agreement could help it target more than 1.7m home consumer credit customers.
Lewis Findlay, chief executive of Hertford, said: “This is a transformational deal for Hertford. We believe that Cheque Exchange currently represents approximately 5% of the entire UK third party cheque cashing market, as well as being the largest independent MoneyGram agent.
“We look forward to building upon this superb business, and are confident that Hertford can substantially increase this market share, as well as capitalising upon further significant opportunities to cross-sell a range of complementary products and services, including a new suite of Crewcard Network pre-paid debit card products which will be launched imminently.
In October, Provident said demand for its products remained high despite the downturn.
