Pepper Money said on Monday it had received a takeover offer from investment manager Challenger and majority shareholder Pepper Group, valuing the company at A$1.16 billion ($814.90 million), helping its shares log a record intraday gain.
Shares of the Australian non-bank lender rallied as much as 33.52% to A$2.350, posting their biggest intraday percentage gain on record. Challenger shares fell as much as 7.51% to rank among the biggest laggards on the benchmark index, which was last up 1.5%.
Under the proposal, Pepper Money shareholders will receive A$2.60 a share, a 47.7% premium to the stock’s last closing price.
Pepper Group, which holds about a 60% stake in the New South Wales-headquartered firm, will initially retain at least its current stake in Pepper Money, the company said.
Challenger said in a separate statement that it would cap its stake at 25% if the deal proceeded, noting that the investment would give it long-term access to fixed‑income assets to bolster growth and returns.
Pepper Money’s independent board has granted Challenger exclusive access to books to conduct due diligence and proceed with transaction documentation after reviewing the deal.
The approach was reported by the Australian Financial Review on Sunday, before Pepper Money confirmed it had received the proposal.
Founded in 2000, Pepper Money specialises in home loans, asset finance and commercial lending, and reported a net profit after tax of A$98.2 million for 2024. Its 2025 results are due next week.
The acquisition offer for Pepper Money comes against a backdrop of renewed consolidation interest in Australia’s listed consumer and non‑bank lending sector.
In late 2025, Humm Group disclosed a non‑binding approach from Credit Corp after already having received a separate offer earlier in the year.
The sector has also seen headline takeovers in recent years, including Block’s acquisition of buy-now-pay-later firm Afterpay, which removed a major consumer-lending name from the ASX.
Pepper Money was first taken private by KKR in 2017 before re-listing in 2021 at an issue price of A$2.89 per share.
($1 = 1.4235 Australian dollars)
Reuters
