The utility to financial services group Centrica said yesterday that it had agreed to pay £85m to HFC Bank to settle a long-running dispute over control of their Goldfish credit card joint venture.
The deal will give Centrica access to details of 1.1 million Goldfish card holders and will pave the way for it to launch, through a partnership with Lloyds TSB, its own internet and telephone bank into this already crowded market.
Relations between Centrica and HFC, which supplies a number of credit card brands, soured last December when Centrica announced plans to replace the bank with Lloyds as its partner in Goldfish before their five-year contract expired on 3 September.
HFC, which administers the Goldfish accounts, challenged Centrica in court over who owned lucrative details about Goldfish customers, such as their repayment habits. The High Court ruled in June that HFC could retain this database about clients while Centrica kept the brand and Goldfish loyalty scheme. A Centrica spokeswoman said it had decided to buy the database from HFC rather than appeal. "We think the Goldfish customer base is rich ground, as 80 per cent of customers want to receive information about other financial services," she said.
HFC said it had decided to sell the book on rather than transferring the customers to its Marbles credit card brand because the price of £85m tax-free was a "good price".
Centrica shares fell 3p to 222p. The company has been dogged by doubts about the success of its strategy of diversifying into financial services. It recently acquired the Automobile Association for £1bn.
But the AA business has been profitable, and the costs of Goldfish, which has about 3 per cent of the UK card market, should come down now that a deal has been reached.
Centrica and Lloyds, which will hold 30 per cent of the new joint venture, have yet to secure a banking licence for the business, which will initially offer savings accounts but broaden the range later to include current accounts and mortgages.Reuse content