Humiliation in bitter battle for the Provvy

But tycoon presses on with hostile takeover despite investor snub

THE tycoon seeking to take over Provident Financial has vowed to press ahead despite failing to win support from huge numbers of shareholders.

John van Kuffeler’s battle to buy the doorstep lender has been backed by investors who own just 53.53pc of its stock, a stock market filing revealed last night.

This is well short of the 90pc backing van Kuffeler initially aimed for.

And although it technically puts him in control, he will not be able to cancel the Provvy’s listing or merge it with his business, Non-Standard Finance (NSF), as planned.

NSF last night said it will give other shareholders time to reconsider.

If it can get to 75pc or above a full merger between the two businesses can go ahead. But if this level is not reached they will have to remain separate with their own management teams, undermining NSF’s main argument for doing the deal.

The result will be seen as particularly unimpressive because when NSF launched its takeover bid in February it had already won the backing of three major investors – Invesco, Woodford Asset Management and Marathon – which controlled 50pc of the company’s stock.

It means that despite a bitter takeover battle which has raged for months, NSF has only convinced another 3.5pc of Provvy investors to come on board.

NSF now needs to secure support from regulators by June 5 for the deal to be approved.

In the meantime, it will hope some investors who held out will admit defeat and lend their support. Van Kuffeler said: ‘We are pleased to have passed this important milestone and are focused on satisfying all remaining conditions as soon as possible so that we can start to unlock substantial value for shareholders and restore Provident’s business culture for the benefit of its customers and employees.

‘We have been, and are continuing to engage with, Provident shareholders and hope those who have not yet done so will join us by accepting our offer.’

The 70-year-old previously ran the Provvy for 22 years, and it is feared he could seek to exploit its 2.4m vulnerable customers.

The Financial Conduct Authority (FCA) watchdog sent a highly unusual letter to him after he proposed the takeover, warning that any effort to cut corners will not be tolerated.

The FCA and Bank of England are now likely to come under heavy pressure to stop the deal.

There are also questions over whether the Competition & Markets Authority will allow it – as it could rule that the takeover would reduce competition in doorstep lending.

A Provvy spokesman said: ‘This deal is not done. In three months, NSF has added just 3.5pc of support, which speaks volumes.

‘Three regulators still need to bless this and shareholders should continue to reject this woeful offer.’

Provvy shares dipped 6.5pc, or 31.2p, to 450p while NSF shares fell 1.5pc, or 0.75p, to 48p.