Frontier/RMG transaction complete
For immediate release
Frontier/RMG transaction complete
June 20: Frontier Petroleum (ASX: FRO) today settled the acquisition of the business interests of Receivables Management Limited (RML) and a number of associated companies in Australia and New Zealand for $A80 ($NZ100) million.
Frontier has now changed its name to RMG Limited and is expected to relist in both Australia and New Zealand within the next two weeks.
The transaction was settled by the issue of 296 million Frontier ordinary shares and the payment of $A20 ($NZ25) million in cash.
The settlement follows the successful completion of a $A25 million capital raising from investors in Australia and New Zealand.
New RMG chief executive Mr Paul Cooney said: “the fact that we have been able to raise this capital during such volatile times in international sharemarkets comes as a vote of confidence in the new direction of RMG and the opportunities that exist within the receivables management sector.”
The transaction creates a $A120 ($NZ150) million company which will be the first to offer an integrated range of receivables, debt management and credit reporting services under a single umbrella on both sides of the Tasman.
An earlier independent appraiser’s report
commissioned by Frontier for shareholders had declared the
transaction fair and reasonable.
Mr Cooney and Mr David De Campo have been elected as directors of the company. Mr Cooney replaces Mr John Tarrant as chief executive. Mr Tarrant continues as a director of the company. Mr Graeme Boden has resigned as a director.
Mr Cooney is one of the major vendors of the companies that make up RMG and is a 30-year veteran of the receivables management industry. He is National President of Australian Collectors Association, Fellow of Institute of Management and Fellow of the Australian Institute of Credit Management.
Mr De Campo (MBA) is a Director of Advantage Group (Australia) Limited. He was previously Managing Director of LibertyOne Services Ltd and Managing Director (Australia/New Zealand) of the Services Providers Business Unit for Lucent Technologies. He was also National General Manager of Investment and Business Processes at Telstra, and National Marketing Manager for Hewlett Packard.
Mr David McLaughlan has been appointed chief financial officer and company secretary, replacing Mr Rowley Butters.
Mr Cooney said RMG was formed to consolidate the receivables management industry in line with international trends.
“Historically, the receivables management industry has been fragmented, comprising many small players offering a limited range of products and services, Mr Cooney said.
“RMG has the mass, resources and capabilities, unique information and intellectual property sufficient to meet all client service requirements under the one roof. We believe we will be able to lead the industry in meeting the expected demand from both the public and private sectors for outsourcing the management of a range of functions such as ledger management, debt purchasing and a variety of other services including credit information,” he added.
The new receivables management group has been formed out of 10 Australian and six New Zealand businesses. “The integration of the New Zealand businesses is almost complete and the plan for the integration of the Australian businesses is well advanced, Mr Cooney said.
“We are also actively pursing new business opportunities. These are opportunities that would not have been available to the individual receivables companies before the merger but which we are now well placed to serve.”
RMG is forecast to turnover $A57 ($NZ71) million providing net profit after tax of $A5.9 ($NZ7.37) million in the year to June 30, 2001.
RMG is the first trans-Tasman company to offer an integrated range of receivables, debt management, and credit reporting under a single umbrella. The company was formed by the merger of a number of receivables management companies in Australia and New Zealand. Services include traditional debt recovery and receivables management, credit information and database management services, debt purchasing, factoring, ledger management and complete outsourcing of a company’s receivables function through leading edge internet-enabled technology.