Ex-boss bids for Provident Financial
AILING Provident Financial has been targeted in a £1.3bn takeover swoop by its former boss John van kuffeler.
Van kuffeler’s firm Non-Standard Finance is seeking to woo disgruntled Provvy investors after a 76pc slump in the doorstep lender’s shares in less than two years.
The Provvy’s stock crashed when it issued a profit warning in 2017 after a disastrous IT meltdown and mis-selling investigations.
Unveiling his plans, Van kuffeler, 70, said his former firm ‘has lost its way’. NSF said it has already won backing from more than 50pc of Provvy shareholders, including Neil woodford, but is aiming to get 90pc support for the deal. Van kuffeler, who ran the lender for 22 years as chief executive and then chairman before leaving in 2013, said his present business first tried to buy the Provvy in January last year but was knocked back.
He slammed bosses for their lack of knowledge about the market, and accused them of taking the firm in the wrong direction.
The present chief executive is Malcolm Le May, who took over a year ago after the sudden death of Manjit wolstenholme, and has limited experience in the industry.
Van kuffeler said: ‘we have recognised the strong logic of a combination with Provident for some time and hence approached the Provident board with a proposal in January last year.
‘That approach was rebuffed and since then Provident has further lost its way.’
The deal would see investors given 8.88 shares in the new merged company for every Provvy share they own now.
In a letter to Provvy staff, he said: ‘The board of Non-Standard Finance and I believe that completion of the transaction would mark the end of what has been a very difficult period.
‘we also believe it would mark the beginning of a return to the steady success and progress that Provident enjoyed during my 22 years of leadership.’ If the takeover is successful, Van kuffeler plans to sell the Provvy’s Moneybarn car finance arm, which has been hit with a Financial Conduct Authority probe over its sales practices and has set aside £20m for fines and compensation.
He will also either sell or shut the Satsuma payday lending operation, which charges as much as 1,575pc in interest.
Credit card arm Vanquis Bank will be kept open.
Van kuffeler – a well-connected descendant of Flemish aristocracy who was a guest at Prince william’s wedding – plans to improve the doorstep lending operation which is the heart of the company. Shares in the Provvy rose 15.3pc, or 78p, to 589.4p. NSF rose 16.5pc, or 9.5p, to 67.1p.