Nicholas Financial Inc.’s board has voted to kill its acquisition deal with Prospect Capital Corp.
The company’s board voted yesterday to terminate the agreement to be acquired by Prospect, in light of the looming June 12 termination deadline. Clearwater, Fla.-based Nicholas had agreed last December to sell its issued and common shares to an indirect wholly owned unit of Prospect.
But last month, Prospect Capital revealed that it no longer expected its acquisition of Nicholas Financial to close by June 12 as originally planned, according to a Securities and Exchange Commission filing. The deal was delayed because the SEC had asserted that certain Prospect subsidiaries should be consolidated.
Prospect is a closed-end investment company that focuses on lending to and investing in private businesses. Prospect’s investment objective is to generate current income and long-term capital appreciation through debt and equity investment.
Nicholas Financial had a $269.3 million loan portfolio as of March 31, up 7.8% from the year-prior period.
A Nicholas Financial spokesman told Auto Finance News that the company will evaluate strategic alternatives, including the possible sale of the Company to Prospect or another third party. As far as strategy, Nicholas will continue with business as usual, he said.
