Embattled rent-to-buy retailer PerfectHome up for sale

1003
PerfectHome

PerfectHome has put itself up for sale as the Financial Conduct Authority (FCA) continues to pile pressure on rent-to-buy schemes.

According to Sky News, the UK’s second largest credit-based retailer is in talks with at least one potential buyer.

It is understood that the retailer could be valued at as little as £30 million and comes just months after it was ordered to pay back £2.1 million to customers after it was found to have failed to properly assess its customers’ financial situations.

Deloitte has reportedly been brought in to oversee the sales process.

Alhough the potential buyer is not yet known, US investment company Elliott Advisors will likely hold the final say as they own most of the company’s debt.

The FCA has gone on the offensive against the controversial rent-to-own sector in the last two years, and is seeking to further tighten regulations, which would also affect retailer BrightHouse.

Last month the FCA announced it was set to examine a range of measures to further reform the credit market, once of which could be a cap on the high-level costs customers are forced to pay on their rentals, which include big ticket items like TVs, furniture and household appliances.

The latest clampdown is reportedly set to save consumers up to £200 million a year.

“Our key priority is to ensure all financial firms lend responsibly and treat consumers fairly, especially those in financial difficulties or who are vulnerable,” FCA executive director of supervision for retail Jonathan Davidson said.

In the year to April 2017, PerfectHome’s owner Temple Finance reported a pre-tax loss of £29 million, while slashing its store estate by 29 stores to 18.

Click here to sign up to Retail Gazette‘s free daily email newsletter