NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION
FOR IMMEDIATE RELEASE
12 April 2019
Provident Financial plc ("Provident")
Concern at lack of response from Non-Standard Finance plc ("NSF") on unanswered questions
· The Provident Board remains gravely concerned by NSF's failure to respond to the material outstanding questions, raised by Provident ten days ago on 2 April 2019, both in relation to the Offer and NSF's historical dividend payments and share buybacks. Provident shareholders deserve clarity to enable them to make an informed decision on the merits, or otherwise, of the Offer.
· We note that the vast majority of shares subject to acceptances of the Offer to date have come from shareholders who also hold shares in NSF and who may therefore have a different perspective as to the merits of the Offer than that of other shareholders.
· The Provident Board continues to have significant concerns about the Offer, not least because NSF has repeatedly made pre-tax losses on a statutory basis, its share price is near an all-time low, and it would opportunistically benefit from the relative financial strength of Provident.
· The terms of the Offer remain highly unattractive for Provident Shareholders. Based upon the latest NSF share price, the Offer values each Provident share at 449 pence, a 13.9 per cent and 12.1 per cent discount respectively to the latest Provident share price and the Provident share price immediately prior to NSF's Rule 2.7 announcement.
The Provident Board strongly advises all Provident Shareholders to take no action in relation to the Offer.
Capitalised terms used in this document shall have the same meanings given to them in the response document published by Provident on 23 March 2019.
Bases and Sources
Unless otherwise stated:
1. The value of the Offer for each Provident share of 449 pence is calculated using the NSF Closing Price on 11 April 2019 of 53 pence, less the NSF declared final dividend of 2 pence in respect of the year ended 31 December 2018 which Provident Shareholders would not receive under the terms of the Offer, multiplied by 8.88, which is the exchange ratio of new NSF Shares for each Provident Share stated in the NSF Offer Document. It is noted, however, that NSF has stated as part of its Offer that it will have the right to reduce the number of new NSF Shares that Provident Shareholders would receive by the amount of any dividend (or other distribution) which is declared, paid or made by Provident to Provident Shareholders, on a basis to be determined by NSF. This adjustment, which would reduce the value of the Offer for each Provident share, has not been reflected in this calculation.
2. The assertion that the Offer valuing each Provident share at 449 pence results in a 13.9 per cent. and 12.1 per cent. discount respectively to the latest Provident share price and the Provident share price immediately prior to NSF's Rule 2.7 announcement is calculated by reference to (i) the Provident Closing Price on 11 April 2019 of 522 pence, and (ii) the Provident Closing Price on 21 February 2019 of 511 pence.
Provident Financial plc, Tel: +44 12 7435 1135
Patrick Snowball, Chairman
Malcolm Le May, Chief Executive Officer
Gary Thompson / Vicki Turner, Investor Relations, Tel: +44 12 7435 1900
Richard King, Media, Tel: +44 20 3620 3073
Barclays (Joint Lead Financial Adviser and Corporate Broker to Provident)
Richard Taylor, Tel: +44 20 7623 2323
J.P. Morgan Cazenove (Joint Lead Financial Adviser and Corporate Broker to Provident)
Ed Byers, Tel: +44 20 7742 4000
Jefferies (Financial Adviser to Provident)
Graham Davidson, Tel: +44 20 7029 8000
Brunswick (PR Adviser to Provident)
Nick Cosgrove, Tel: +44 20 7404 5959
Barclays Bank PLC, acting through its Investment Bank ("Barclays"), which is authorised by the Prudential Regulation Authority (the "PRA") and regulated in the United Kingdom by the Financial Conduct Authority (the "FCA") and the PRA, is acting exclusively as corporate broker and financial adviser for Provident and no one else and will not be responsible to anyone other than Provident for providing the protections afforded to clients of Barclays nor for providing advice in relation to any matter referred to in this announcement.
J.P. Morgan Securities plc, which conducts its UK investment banking business as J.P. Morgan Cazenove, is authorised by the PRA and regulated by the FCA and the PRA in the United Kingdom. J.P. Morgan Cazenove is acting exclusively as corporate broker and financial adviser to Provident and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters set out in this announcement and will not be responsible to anyone other than Provident for providing the protections afforded to clients of J.P. Morgan Cazenove or its affiliates, or for providing advice in relation to the contents of this announcement or any other matter referred to herein.
Jefferies International Limited ("Jefferies"), which is authorised and regulated in the United Kingdom by the FCA, is acting for Provident and no one else in connection with the matters set out in this announcement. In connection with such matters, Jefferies will not regard any other person as their client, and will not be responsible to anyone other than Provident for providing the protections afforded to clients of Jefferies or for providing advice in relation to the contents of this announcement or any other matter referred to herein. Neither Jefferies nor any of its subsidiaries, affiliates or branches owes or accepts any duty, liability or responsibility whatsoever (whether direct, indirect, consequential, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Jefferies in connection with this announcement, any statement contained herein or otherwise.
Forward looking statements
This announcement may contain certain "forward looking statements" regarding the financial position, business strategy or plans for future operations of Provident. All statements other than statements of historical fact included in this document may be forward looking statements. Forward looking statements also often use words such as "believe", "expect", "estimate", "intend", "anticipate" and words of a similar meaning. By their nature, forward looking statements involve risk and uncertainty that could cause actual results to differ materially from those suggested by them. Much of the risk and uncertainty relates to factors that are beyond Provident's ability to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements which speak only as at the date of this document. Provident does not assume any obligation to, and does not intend to, revise or update these forward looking statements, except as required pursuant to applicable law or regulation.
A copy of this announcement will be made available, subject to certain restrictions relating to persons resident in restricted jurisdictions, on the Provident website at www.Providentfinancial.com by no later than 12 noon (London time) on the business day following this announcement. For the avoidance of doubt, the content of this website is not incorporated by reference into, and does not form part of, this announcement.
This communication is not intended to and does not constitute an offer to buy or the solicitation of an offer to subscribe for or sell or an invitation to purchase or subscribe for any securities or the solicitation of any vote in any jurisdiction. The release, publication or distribution of this communication in whole or in part, directly or indirectly, in, into or from certain jurisdictions may be restricted by law and therefore persons in such jurisdictions should inform themselves about and observe such restrictions.