Non-Standard Finance’s hostile takeover of Bradford’s Provident Financial took a massive step forward today after its £1.3bn offer became unconditional as to acceptance.
Non-Standard Finance is ploughing ahead with its takeover plan for the doorstep lender, even though it failed to win the backing of some of its larger rival’s investors.
Investors holding only 53.53 per cent of Provident’s issued share capital accepted the offer, well short of a 90 per cent target.
The deal is now subject to regulatory approval and the verdict of remaining shareholders.
NSF first made a move on Provident in February sparking a bitter war of words between the two lenders.
A statement from NSF read: “This is an important milestone as we progress towards building a brighter future for Provident’s customers, employees and shareholders.
“The NSF Board would like to take the opportunity to thank those shareholders who have already accepted our Offer and looks forward to further engagement with all remaining shareholders in the coming days and weeks as we work towards satisfying all other conditions on or before June 5, the last date on which the Offer may become or be declared wholly unconditional.”
NSF had set a deadline for shareholders of May 15 for its bid to be made unconditional.
The deal will now require the approval of both the Prudential Regulation Authority and the Competition Markets Authority.
John van Kuffeler, NSF’s group chief executive, said: “We are pleased to have passed today’s 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.
“We are excited at the prospect of working with the many talented management and staff at Provident, a number of whom will know me as a former colleague, to help us build a brighter future for the benefit of all stakeholders.”
The move likely to displease Provident’s management team who had expressed fierce opposition to the bid, accusing NSF of giving an overly positive perspective on its own financial performance, despite reporting statutory losses.
NSF robustly dismissed suggestions it would have to raise fresh capital if it was to succeed in its takeover bid for Provident, despite claims from Provident’s management that there may be an “under-capitalisation of the enlarged group”, potentially requiring a capital raise.