Competition watchdog to investigate Non-Standard Finance’s £1.3bn Provident takeover bid
The UK’s competition watchdog has launched an investigation into Non-Standard Finance’s (NSF) £1.3bn takeover bid for rival subprime lender Provident.
A war of words between the lenders has escalated in recent days after NSF made a surprise offer for its larger rival on Friday.
Read more: Provident defends annual results delay as takeover row escalates
The bid has been supported by more than 50 per cent of Provident shareholders, including Neil Woodford’s investment vehicle, Invesco Asset Management and Marathon Asset Management.
The trio also hold significant stakes in Non-Standard Finance.
Provident executives hit back yesterday at the “irresponsible and highly opportunistic” approach.
The Competition and Markets Authority (CMA) has now stepped in, launching an inquiry into what it called the “anticipated acquisition” and its impact on the market.
It issued the firms with an initial enforcement order, preventing NSF from taking steps to integrate the two businesses.
Both companies have also been ordered to stick their pre-offer business plans.
Provident chief executive Malcolm Le May told City PM yesterday that he planned to explore all options in order to submit a better offer to shareholders.
He added that he was “very conscious” of certain shareholders’ dual interests in the matter but his duty was to get the best for all investors.
NSF questioned Provident’s decision to delay its full year results, which were due to be published tomorrow, until 13 March.
The company said it was a “highly unusual move which delays the opportunity for shareholders to judge Provident’s recent performance”.
Read more: Provident slams 'irresponsible and highly opportunistic' takeover bid
But Le May said the firm needed to “take a few more moments” and that shareholders would understand.
The doorstep lender has seen its share price plunged 84 per cent since May 2017, as it has battled with a financial watchdog investigation, profit warnings and struggles with its credit card business Vanquis Bank.
Non-Standard Finance's bid including plans to simplify Provident, through the demerger of its home credit business Loans at Home and the sale of its car loan arm Moneybarn and short-term unsecured loan business Satsuma.