RHG who? Pepper launches bid for $1 billion acquisition

by AB02 Oct 2013

Whilst still embroiled in its bid war over RHG, Pepper Australia has submitted a bid for UK banking group Lloyd’s assets alongside Macquarie Group and Westpac.

According to Reuters reports, Lloyds is selling its BOS International corporate loans and Capital Finance motor and equipment finance businesses in Australia, with an estimated value of around $8.5 billion.

Pepper and Macquarie made final bids for the assets and the operations up for sale have an estimated net book value of A$1 billion, according to one source.

However, analysts expect Pepper and Macquaries’ bids are likely to be less than Lloyds had hoped for, potentially clearing the way for a shortlisted offer from rival Westpac.

The sale is reportedly part of Lloyd’s global plan to cut costs and strengthen its balance sheet as the bank shuts down its international operations in an effort to refocus on British borrowers.

“Lloyd's began its sell-off with a portfolio worth some 200 billion pounds (A$324 billion) and has now more than halved it. The British government is eventually expected to sell its 32.7% share in the bank,” writes Reuters reporter, Jackie Range.

Pepper’s bid is the latest in a string of acquisitions. Along with its current fight with Resimac over mortgage book RHG, Pepper bought GE Capitals’ Australia and New Zealand mortgage lending business in 2011.