UK business lender Portman Finance Group is in talks with private equity firms, including Pollen Street Capital, about a sale valuing the company at more than 300 million pounds, a process that matters broadly because it would be one of the largest specialist finance deals in the UK market this year, and matters specifically to accountancy professionals because a sale of this scale requires extensive financial due diligence on loan book quality, credit provisioning and earnings before any deal completes.

Portman Finance Group is a Northampton-headquartered specialist business-to-business finance broker and lender founded by Alex Read in 2007, having provided funding to more than 20,000 SMEs and posting revenue growth of 81 per cent in the year to September, features that have placed it on Sunday Times and Financial Times fast-growth company lists.

Investment bank Stephens is running the sale process for Portman Finance Group.

A specialist lender's financial due diligence differs from a typical trading business precisely because its reported earnings depend on assumptions rather than completed transactions. Buyers scrutinise loan book quality, credit provisioning and the seven distinct financial workstreams that comprise a standard quality-of-earnings review, treating the process much like an audit committee would.

Portman's 81 per cent revenue growth is exactly the profile that draws the closest scrutiny under that process, since bidders need independent verification that growth reflects sustainable lending performance rather than a temporary surge in originations or looser underwriting standards.

That scrutiny typically runs for weeks and involves both a vendor due diligence report prepared for the seller and separate buy-side reviews commissioned by each interested private equity firm, generating parallel accounting mandates across the same transaction rather than a single advisory engagement.

With several buyout firms reportedly involved and the structure of any deal, controlling stake or minority sale, still undecided, the accounting workstreams required could scale further depending on how many bidders progress and whether the transaction structure changes.

For the sector, a 300 million pound specialist lender sale is a reminder that fast-growing financial services businesses generate substantial due diligence work well before any deal is confirmed, let alone completed.

Source: Sky News / Yahoo Finance / DealRoom / Deloitte