Exclusive: Ousted CEO Laplanche studies LendingClub takeover - sources
By Olivia Oran and Joy Wiltermuth
(Reuters/IFR) - Ousted LendingClub Corp (LC.N: Quote) CEO and co-founder Renaud Laplanche has been speaking to private equity firms and banks about financing a potential buyout of the online lender, according to people familiar with the matter.
The French entrepreneur, one of the highest-profile names in the fledgling industry, left LendingClub in May after an internal probe found the company had falsified documentation when selling $22 million of loans to an investor.
The scandal sent shock waves through a sector already dealing with investor nervousness about rising loan losses and cratered LendingClub's stock, which has lost nearly 40 percent of its value in under a month.
In the weeks following his May 9 departure, Laplanche approached firms about financing a bid to take the company private, the people said.
The talks were preliminary and may not lead to a deal, said the sources, who asked not to be named because the matter is private.
Laplanche declined to comment on his future plans. A representative for LendingClub declined to comment.
Once the industry's biggest champion, Laplanche has put the sector firmly in the regulatory spotlight. The Department of Justice is probing the circumstances leading up to his departure and the New York Department of Financial Services is separately investigating the company's business practices.
Such regulatory heat could make it difficult for Laplanche to secure funding, one of the sources said. Continued...