- Release Date: 27/08/12 15:02
- Summary: GENERAL: GFL: GFNZ GROUP ANNOUNCES $3m PROFESSIONAL INVESTOR FUNDING
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GFL 27/08/2012 13:02 GENERAL REL: 1302 HRS GFNZ Group Limited GENERAL: GFL: GFNZ GROUP ANNOUNCES $3m PROFESSIONAL INVESTOR FUNDING Media Release 27 August 2012 GENEVA FINANCE ANNOUNCES SUCCESSFUL $3.0M FUNDING FOR ITS PROFESSIONAL INVESTOR FUNDING PRODUCT NZAX-listed auto loan provider GFNZ Group Ltd (Geneva) has s successfully placed $3.3m of new business receivables into a Prime Asset Trust Limited funding scheme, using this security to raise a total of $3.0m of new debt funding from its cornerstone investor, Federal Pacific Group Limited. This placement will assist Geneva in maintaining its track record of early repaying its scheduled debt repayment program and provide funding for the expansion of its profitable new business model. Prime Asset Trust Limited Scheme: Responding to a difficult funding market, Geneva developed a funding product that offers a highly secure, high cash flow, investment opportunity to investors. The key features of this product are: oIt is only available to professional investors. i.e Investors who qualify as "eligible persons" per section 5(2CD) or section 5(2CE) of the Securities Act 1978 may subscribe for these investments. oThe financing structure is completely independent of Geneva, i.e. Whatever course Geneva takes in the future these receivables and the cash flows they generate are exclusively for the benefit these investors, oGeneva retains a subordinated position of up to 20% in the receivables but receives no cash from the investment until all investors principal and interest is repaid in full. Managing Director, David O'Connell says, "This is an innovative product where getting the first tranche away is the challenge, once investors see how this investment performs, we expect there will be ready appetite among the professional investor community, who will appreciate both the security the structure offers and the high yield of circa 9.0%." Debenture Repayment ahead of timetable: The board has also approved the further repayment of $2.5m on Friday 31st August, four weeks ahead of schedule. This announcement maintains Geneva's record of early repayment, following on from the early repayments of the September 10, March 11, September 11 and March 12 scheduled debenture principal repayments. This repayment is being made under Resolution 1.4(b) of the Interest Bearing Repayment Plan to repay Moratorium Debenture holders and BOSIAL early, either in full or in part on a pro rata basis. Inclusive of this payment, Geneva Finance has repaid $132.8m of investor principal and interest payments since the Company entered moratorium in November 2007 owing a net $132.4m to investors. These repayments are inclusive of interest payments to investors (including the company's bankers) of $38.9m at a weighted average interest rate of 10.7% and principal repayments to public debenture holders totaling $68.3m Revisit Shareholders Rights issue: As announced on 14th August, the board will be revisiting the timing of the rights issue and expect to make an announcement in early October. "The board felt it was important to settle this $3.0m funding tranche before proceeding to the rights issue". Says David O'Connell, "We have set ourselves a series of milestones to achieve and are committed to completing them in sequence before moving to the next step. Finalisation of the debt placement took longer than expected, that was the reason for deferring the Rights Issue and now the debt placement has occurred, we can revisit the rights issue in early October" Achievements to date: While there are many challenges facing the company and the sector, the board's commitment to the core strategy remains unchanged. This debt funding initiative is another step forward and a significant achievement for Geneva which to date includes: oRepayment of more than $132.8m of debt funding to investors (including interest of 11.0% per annum to public debenture holders); oReducing group operating costs by more than $29m per annum since October 2007; oAcquiring the Quest Insurance and Stellar debt collection operations to complement core financing activities; oImplementing real time online internet-based scorecards and loan application systems for introducers; oRestructuring operations to allow the new business model to focus on a market segment that offers attractive yields that carry considerably less risk. ends About Geneva Geneva is a New Zealand-owned finance company that provides finance and financial services to the consumer credit and small to medium business markets. Geneva commenced business on 7 October 2002. Geneva's loans are originated through three distribution channels (Direct, Broker and Dealer), processed by the central sales desk then administered through a national operations centre located at Mt Wellington, Auckland. The company borrows money by the issue of debenture stock. It also has a banking facility with BOS International (Australia) Limited. Geneva (GFL) is listed on the NZAX. There are 224,698,631 issued shares held by 2,629 investors. About Federal Pacific FedPac's operations throughout the Pacific region include investments in Banking, Personal and Business Finance, Money Transfer and Foreign Exchange Trading. The company was incorporated in 1993 and is based in Auckland, New Zealand. Alexander Communications Kate Alexander +64 (0)27 244 6094 [email protected] For further information: End CA:00226498 For:GFL Type:GENERAL Time:2012-08-27 13:02:42
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- Ann: GENERAL: GFL: GFNZ GROUP ANNOUNCES $3m PROFE
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