Amid rising shareholder opposition and after more than four months of acrimony on all sides, Non-Standard Finance (NSF) this week withdrew its hostile bid for larger doorstep lender Provident Financial (PFG).
On Tuesday, NSF said that following discussions with regulators it had determined that the combined group “would not have sufficient regulatory capital on a consolidated basis at completion”. Ahead of a 5 June deadline to declare its offer wholly unconditional, NSF said it would instead let its offer lapse.
Chief executive John van Kuffeler, the Provvy's former chairman and chief executive, expressed his disappointment that despite his current group’s “best efforts”, customers, employees and shareholders of both groups “will not now benefit from our transformation plan to build a brighter future by combining Provident with NSF”.
The market seemed to disagree with that verdict, pushing up shares in Provident by 16 per cent to 517p on the news. Inadvertently, that provided one silver lining to embattled fund manager Neil Woodford, whose investment arm was one of three major investors in both companies to throw their weight behind NSF’s consolidation attempt. Since the bid was launched in February, NSF only managed to convince investors holding a further three per cent of Provident stock to back the deal.
