Sub-prime lender Provident Financial has slammed a potential acquirer’s “record of value destruction” as it urges shareholders not to take up a takeover offer.
Fellow sub-prime lender Non-Standard Finance has tabled the full documentation for its offer for Provident this morning, but Provident has already rebuffed it, claiming it undervalues the group and its prospects.
Provident adds that the offer “presents significant operational and execution risks due to the changing regulatory environment”, while NSF has “limited experience across the full breadth of Provident’s businesses”.
In its statement, Provident says: “The board’s considered response to the offer will be published in due course. In the meantime, shareholders are strongly advised to take no action with respect to the offer.”
In its offer letter, NSF is critical of Provident’s board too, saying it “cannot and does not understand the key issues involved in managing a business like Provident” and “has shown itself, as recently as its profits warning in January, to be incapable of implementing any kind of clear strategy”.
The battle to win over key shareholders will contine after Woodford Investment Management and Invesco agreed they would accept NSF’s £1.3bn offer for the company.
Money Marketing revealed earlier this month that Schroders had upped its stake in the firm though.