The bitter public fight for control of the humm buy now pay later business deepened on Wednesday with “ostracized” board director Andrew Abercrombie revealing he was continuing to build his shareholding in the company.
Abercrombie, the founder and former chair of the company, is fighting a lone battle on the humm board to block the planned sale of the consumer finance business to Latitude Financial.
The deal, which is set to be voted on by shareholders on 23 June, would see humm investors receive a cash payment of A$35 million and 150 million Latitude shares.
For the past month, Abercrombie has been buying humm scrip in an effort to shoot down the deal at the shareholder meeting.
According to an ASX filing on Wednesday, Abercrombie paid $1.7 million for another 2.4 million shares this week.
This brings his total holding in the company to 113.1 million shares, which represents about 24 per cent of the issued scrip of the company.
The deal with Latitude requires the support of more than 50 per cent of humm shares to proceed.
While several institutional shareholders have indicated they plan to oppose the sale, it is not clear whether Abercrombie has sufficient support to scuttle the transaction.
In a separate filing to the ASX on Wednesday, the majority of directors on humm’s board accused Abercrombie of making “misleading” statements about the performance of humm’s BNPL business.
The directors challenged statements by Abercrombie that humm’s BNPL business was profitable.
“humm’s BNPL business is not profitable and HCF is not growing. As a standalone, sub-scale business, the Majority Directors believe that HCF faces significant macro and structural headwinds, and the entire BNPL sector is under pressure,” they said in the ASX filing.
“As disclosed in its 1H22 accounts, for the six months ended 31 December 2021, humm’s buy now pay later (BNPL) business reported a cash NPAT loss of $9.7 million.”
humm’s share price closed down 2 cents to 67.5 cents on another horror day of trading for BNPL stocks.