International Personal Finance (LSE:IPF) has agreed to be taken over in a £543 million all-cash deal led by BasePoint Capital, a US speciality finance group, in a move that would end nearly two decades of life as a London-listed company.
IPF shareholders will receive 235p in cash for each share. They will also be entitled to the 9p final dividend payment.
The offer represents a premium of 31.1% to the closing share price on 29 July, the day before the formal offer period began, rising to more than 60% when compared with average prices over the past year.
IPF provides small-sum consumer loans in nine countries across Europe and Mexico, serving customers who are often unable to access credit from mainstream banks.
While the company is listed and headquartered in the UK, it has no customers here, having grown out of Provident Financial’s international division before being demerged in 2007.
BasePoint said IPF had built a “differentiated” business over nearly 30 years, combining traditional home credit with digital lending. It argued that private ownership would allow management to take a longer-term and more flexible approach to strategy, free from the pressures of public markets.
The IPF board, advised by Stephens, said the terms of the offer were fair and reasonable and has unanimously recommended that shareholders vote in favour. Directors who own shares have already given irrevocable undertakings to support the deal.
While the board said it remained confident in IPF’s long-term prospects as a standalone business, it acknowledged that the company’s valuation had persistently lagged comparable international lenders despite strong profits and returns.
Against that backdrop, it concluded that the cash offer from BasePoint, at a significant premium, was in the best interests of shareholders.