1 Comment 1 CommentAfter assessing interest from bidders who conducted a due diligence, it said it would retain the business.
"We said at the beginning of this process, that FPA would only divest the finance business if value exceeded our internal valuation," managing director John Bongard said.
Reports suggest that up to 10 parties, including other finance companies and private equity players, had looked at the business and that it was expected to fetch between $170 million and $200 million.
"This disciplined approach has not resulted in a sale and is a decision that we are very comfortable with," Bongard said in a statement yesterday.
He said the business had exciting growth prospects and F&P will continue the existing business plan to grow the Q Card and Farmers Card products.
He said the business is currently performing well and was strongly positioned to take advantage of the opportunities resulting from the reducing number of participants in the finance company sector.
Goldman Sachs says the "decision will be a disappointment to the market as it postpones a potential positive catalyst for the stock."
"In addition we believe that in the current market conditions it is unsurprising that bids have failed to exceed FPA's internal expectation. We would not rule out a potential disposal in the future, given that the Finance division contributes 24% of group earnings and is essentially non-core.
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