Australia's Credit Corp recoups losses; Morningstar says Humm deal could destroy value

Humm

18/12/2025 03:29

** Shares of Australia's Credit Corp Group CCP.AX recoup losses, rise 2% to A$13.81

   ** The debt ledger purchaser and consumer lender's stock saw its worst day since November 14 on Wednesday, after it proposed to buy Humm Group HUM.AX

** Morningstar analysts say while the deal could expand co's lending business, it may destroy value rather than create it by pushing co into an unfamiliar business with higher risks

** Add deal would expose CCP to front-end lending risks, including underwriting, repayment, and operational management - areas outside its core expertise, which is buying and collecting debt

** A cash deal requires more borrowing and would increase gearing, Morningstar says; CCP has offered A$0.77 in cash per HUM share, alternatively proposing an off-market takeover offer at A$0.72 per HUM share in cash if scheme fails

** YTD, shares down 13.7%

 (Reporting by Shruti Agarwal in Bengaluru)

 ((Shruti.Agarwal@thomsonreuters.com))