Provident Financial ramped up warnings about Non-Standard Finance’s takeover bid on Wednesday, claiming the group would need a £130 million rights issue to fix the balance sheet if NSF wins.
The company, which issued a five- point list of concerns about NSF, said the hostile suitor’s plans to spin off doorstep lender Loans at Home and the expenses of the takeover would weaken Provvy’s capital buffers.
The enlarged group will be regulated by the Prudential Regulation Authority after a deal because Provident owns Vanquis Bank, which comes under the PRA’s remit. The PRA enforces strict capital rules known as CRD IV.
NSF chief John van Kuffeler said suggestions of a capital raise were “complete nonsense and rich coming from Provident”.
The duo are slugging it out ahead of a May 15 deadline when NSF can choose to declare the offer unconditional to further acceptances.
The company already has 51.3% of shares in support. Schroders, which owns 14.6%, yesterday said it would reject the offer.
