Thorn Group’s major shareholder, Bermuda-based investment company Somers Ltd, has launched an offer for all the Thorn shares it does not already own, in an opportunistic move that values the troubled finance company at a tiny takeover premium.

Somers owns 19.9 per cent of Thorn and together with associated companies ICM Ltd, its investment manager, and UIL Ltd, a major shareholder, controls 34.49 per cent of Thorn.

Thorn’s chair Warren McLeland is a former director of UIL.

Somers is offering 21 cents a share, which is a 1.2 per cent premium over the 10-day volume weighted average price of Thorn shares prior to the offer.

The lack of a meaningful premium is an indication of Thorn’s poor performance over the past year.

It closed all 62 of its Radio Rentals stores in April last year and unit installations collapsed, falling 93 per cent in the year to March.

The business finance division was forced to stop originating after arrears reached 36.6 per cent last July, breaching its warehouse covenant. The business has not resumed lending and business receivables have fallen 40 per cent.

In its statement to the ASX on Friday, Somers said that, pending a review of the business, its plan is for Thorn to continue with its current business “in substantially the same manner as it is presently being conducted.”

When Thorn released its 2020/21 financial report last month, chief executive Pete Lirantzis said: “We have started a journey to remediate and recalibrate Thorn’s operations, to transform our traditional bricks and mortar consumer model to a digital pure play operation and to re-enter the business finance segment with a digital first business model.”

If the review is not positive, Somers could put Thorn into runoff and harvest dividends as the remaining contracts are paid out. Thorn slashed its costs last year and made a profit of A$8.4 million, while doing very little business.