Consumer lender Latitude Group Holdings has withdrawn the application made to the Commerce Commission to acquire Humm Group's consumer business in a deal that would've consolidated the two companies' buy now pay later (BNPL) businesses.
The Commerce Commission announced the withdrawal of the application late on Friday. The consumer watchdog was scheduled to make a decision by August 11.
The withdrawal followed an announcement to the Australian Stock Exchange from the two companies, and ructions on the Humm board.
"In light of the current major disruption in financial markets, Humm Group Limited and Latitude Group Holdings Limited have mutually agreed to terminate the proposed sale of Humm Consumer Finance (HCF) to Latitude. Accordingly, the general and scheme of arrangement meetings scheduled to occur on Thursday, 23 June 2022 will be cancelled," the two said.
"The Board of Humm continues to believe that HCF is a high-quality business and intends to review HCF’s strategic direction to focus on its core products and markets in order to restore profitability. The Board and Management remain excited about flexicommercial’s prospects. Humm remains in a strongly capitalised position with surplus unrestricted cash and no drawn corporate debt."
Latitude had announced in February it was buying Humm Group's consumer business in a deal valued at about A$335 million.
Humm, formerly known as Flexigroup, offers a BNPL service under the name Humm, plus a second one under the Bundll brand. It also includes the old Fisher & Paykel Finance business, bought from China's Haier in 2016. The deal was to include Humm's BNPL, instalment and credit card operations, with Humm to have retained ownership of the group's commercial business, Flexicommercial, and remain as a standalone listed company.
Formerly GE Money, Latitude features the GEM brand and offers loans, credit cards and insurance. It also operates the Genoapay BNPL business.
According to Latitude, the combined business would've held more than A$8 billion of gross receivables, A$9.5 billion of transaction volume and more than five million customers.