The Honeycomb Investment Trust (LON: HONY), which focuses on investing in credit assets originated by non-bank lending platforms, mainly in the UK, might be getting ready to make another offer to Pollen Street Secured Lending (PSSL), according to a public statement.
PSSL’s board members had decided not to move forward with a previous offer from Honeycomb, which was made earlier this month. Honeycomb had proposed that the two companies or businesses should merge their operations. Both firms offer alternative-finance funds, which are managed by Pollen Street Capital, a UK-based asset management firm
Waterfall Asset Management has also issued a separate statement confirming that it might consider a cash offer for PSSL, which may be preferred by board members.
On August 14, 2020, HIT stated (while providing a stock market update) that it’s “convinced of the strategic rationale” of merging both businesses to establish what would become one of the leading UK-based specialty finance investment trusts.
Honeycomb noted that a suggested merger, with an exchange ratio of 0.9335 new HIT ordinary shares for each PSSL ordinary share, offers considerable value creation “potential” for both companies’ shareholders. It also offers an opportunity to potentially increase the net asset value, Honeycomb said.
The firm noted that it had discussed this potential deal with its major or large shareholders who confirmed that they agree to the terms of the suggested merger (at least in principle). HIT clarified that the update doesn’t yet qualify as a new offer.
As previously reported, Honeycomb Investment Trust was considering a potential £1.5 billion merger with Pollen Street Secured Lending (PSSL), in order to establish the largest listed investment trust that’s focused on the specialty finance market.
Pollen Street Secured Lending (PSSL) was previously called P2P Global Investments. It’s a British investment trust. The firm invests in consumer and SME loans and also in corporate trade receivables.
Honeycomb had stated, earlier this month, that it would make an official announcement by 5 pm on September 3, 2020, if all stakholders decide to finalize the transaction. This would be in accordance with market rules, the companies confirmed.
