On 24 December 2020, Credit Corp entered into a binding agreement with Collection House to acquire their Australian PDL book. Under the terms of the transaction, Collection House is eligible to receive a proportion of cumulative collections, up to a maximum of $15 million, over an eight year period, if the acquired assets produce returns well in excess of the Group’s hurdle investment return. Upon the acquisition of Collection House in October 2022, this arrangement became obsolete and the contingent liability no longer exist
Interesting benefit of buying collection house, although only if the PDLs are well above hurdle, which they may never have been expected to be.
After buying CLH in October, the acquisition made 3.9m in revenue and lost 1.9m.(pg14)
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