Ultimate Finance takeover confirmed

The take-over bid was announced this morning and Ultimate Finance will become a wholly owned subsidiary of the Renovo Group PLC which commented that it wished to become a prominent provider of credit facilities for UK SMEs and that the Renovo Board will continue to evaluate further acquisitions and alternative routes to access funding for SMEs at commercial rates which are accretive to the strategy.

I’m still uncertain why a cash rich shell company would wish to get involved with a factoring company that is struggling to make any real headway in a market sector that is itself struggling. Renovo claim in the offer document that they will be “continuing to innovate the business model through a more technology focused platform” but as anyone who knows Ultimate will be aware any problems that they have in the marketplace aren’t technology based but are more to do with continually changing direction coupled with a revolving door policy with sales staff that has now probably made it difficult to attract good new salesmen

Another interesting comment in the document was “The recommended acquisition of UFG is the first step in implementing Renovo’s strategy of building a new force in SME lending and growing considerably in an underserved sector” I don’t know who was telling them that the factoring market is underserved but whoever it was probably has a rapidly expanding nose as most of us insiders feel that there are too many players in a market that has been going nowhere for the last few years

Ultimate Finance takeover

Ultimate Finance has received an approach from Renovo Group PLC that may or may not lead to a takeover bid in the legalese jargon of the Stock Exchange.

Ultimate have confirmed that discussions have been on going with Renovo which is a non trading company with a net asset value of £27m and a previous history in the pharmaceutical industry.

To the outsider this is a very unusual fit as Renovo is a shell company with no expertise in any form of finance let alone a niche product like invoice finance and it does make me think why, with a history in pharmaceuticals they have decided that a factoring company is the way forward for them.

It makes me wonder if there is more to this than meets the eye and if Renovo Group are in league with someone else who does have industry expertise – but there again I’ve always loved a conspiracy theory 🙂

Ultimate Finance News

In the last 24 hours I have received two press releases from Ultimate Finance.

The first gave details of their recent introducer jolly where Ultimate apparently took a number of their key introducers to Dubai for an all expenses paid weekend.

“This winter sunshine break saw the group sightseeing and experiencing the culture of one of the most cosmopolitan cities in the world – highlights included a Jeep Safari in the desert, lunch at a 5* hotel overlooking the tallest building in the world, an evening cruise on a luxury boat taking in the beautiful Dubai skyline and the thrill seekers amongst the group also experienced some of the best waterslides in the world”

One of the introducers was moved to state “Thanks to all the staff at Ultimate for a great trip to Dubai and hospitality second to none. I will be getting some more business to you to book my place on the Ultimate 2013 trip”

Whilst another stated:-

“The trip to Dubai was hands down the best incentivised trip I have been on with one of our finance partners. Clearly carefully planned by the Ultimate team, we had a jam packed schedule with lots to do and not at any point did I have to put my hands in my pocket to pay for anything. Everything was catered for and paid for by the Ultimate team, 10 out of 10 guys; I will see you on next year’s trip”

I suppose that it’s naïve to hope that brokers introduce business to the factoring company that best fits their needs not the one that provides the best introducer incentives but I suppose that I’m old fashioned that way.

Amusingly 12 hours later a further press release arrived and this one was concerning the recent placement of shares in order to raise £2.6m. I’m sure that the two events aren’t connected as surely a weekend jolly in Dubai can’t cost that much – or can it?

Bibby is not being taken over by Ultimate Finance

Shares in Ultimate Finance were suspended this morning subsequent to an announcement that talks were well down the road leading to a reverse take-over of another factoring company.

Needless to say the wires have been hot with speculation today and so far it has been confirmed that 15 different factoring companies were the target according to 15 different people with Bibby being the only one so far that hasn’t been mentioned.

I will admit now that I honestly haven’t a clue who the target is and although I can rule out many of those being speculated about on the basis of size, culture or geography I can’t come up with a sure fire alternative.

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