L&G's Salary Finance reportedly in merger talks with Oakbrook

A major merger is on the horizon for Salary Finance, a fintech firm partly owned by Legal & General (L&G), and Oakbrook, a tech-enabled lending platform, according to fresh reports on Thursday.

Sky News reported that the two companies were in advanced discussions to form one of the UK’s largest non-bank consumer lenders.

The merger, orchestrated by L&G and venture builder Blenheim Chalcot, would combine Salary Finance’s employee wage advancement services with Oakbrook’s lending capabilities.

Sky said the union was expected to create a lender with a £500m loan book and 200,000 active customers.

Salary Finance, co-owned by L&G and Blenheim Chalcot and with a portfolio including fintech companies Liberis and Modulr, was expecting to enhance its offerings through the merger.

Blenheim Chalcot, which divested its stake in Clearscore last year, had been negotiating the merger for several months, Sky said.

The potential merger followed the recent restructuring by L&G’s new chief executive officer Antonio Simoes, who had designated a non-core unit for corporate investments, now slated for disposal, including housebuilder Cala Group.

Sky said the deal could dilute L&G’s stake in the newly formed entity, although its long-term investment plans remained unclear.

The merger was expected to be finalised over the summer.

Neither L&G or Blenheim Chalcot had commented on the reports by lunchtime on Thursday.

Reporting by Josh White for Sharecast.com.