SINGAPORE/HONG KONG, July 16 (Reuters) - Finance firm Pepper Australia has roped in Bank of East Asia Ltd to bid for Standard Chartered Plc’s Hong Kong consumer finance unit, putting them in a stronger position to win the auction, people with direct knowledge of the matter said.
The backing of a commercial bank provides Pepper with relatively cheap access to funding, giving it an advantage over the other main challenger, Chow Tai Fook Enterprises, for control of a business which sources have said could fetch between $500 million and $700 million.
As part of the deal, Pepper plans to transfer the mortgage book of Standard Chartered’s PrimeCredit unit to Bank of East Asia, the sources said, requesting anonymity because the talks are not public. Hong Kong-based Bank of East Asia would be able to provide cheaper funding to the Australian firm to run the Hong Kong business, they said.
Spokeswomen for Bank of East Asia, Pepper and Standard Chartered spokesman all declined to comment. (Additional reporting by Byron Kaye in SYDNEY; Editing by Stephen Coates and Ryan Woo)