PaydayUK, the online payday loan brand of Purpose UK Holdings Ltd, will be acquired by the UK subsidiary of Dollar Financial Corp. of the US for £124 million ($195 million).
Dollar Financial currently operates 300 company owned stores in the UK and the acquisition will help it consolidate its operations further.
Recent US legislations capping interest rates on payday loans have triggered many companies to spread their business outside the US, including the UK and Mexico.
Dollar Financial also operates pawn shops in Britain. The acquisition will be accretive and is expected to reflect in the company’s current quarter results. Subject to regulatory approvals, the deal should be sealed in the next 90 days, PaydayUK said in a statement.
The news of the acquisition marginally drove up the share price of Berwyn – Pennsylvania based Dollar Financial to $28.63, a gain of $0.23 over previous close. However, the share has gained by 21% since the first quarter results were declared.