Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Dorchester Pacific adds Oxford Finance to its growing stable

Dorchester Pacific adds Oxford Finance to its growing stable

By Suze Metherell

March 17 (BusinessDesk) – Dorchester Pacific, the finance company that avoided failure in 2010 by convincing investors to accept a debt-for-equity swap, will acquire Levin-based lender Oxford Finance.

The Auckland-based firm expects to pay between $11.3 million to $12.3 million on acquiring the North Island car finance specialist, depending on Oxford’s pre-tax operating earnings for the year ended March 31 2015, Dorchester Pacific said in a statement. It will fund the acquisition using retained earnings and proceeds from a 2013 capital raising.

Dorchester Pacific got a new lease of life in 2010 when Auckland private equity outfit, the Business Bakery, got involved with a recapitalisation plan in which some 7,200 investors owed about $84 million converted their debenture stock for four different types of security to keep the firm afloat while many other finance companies were failing in the wake of the global financial crisis and a local recession.

Acquired by Levin’s electricity lines company Electra in 2003, Oxford had grown the value of its loan book to $50 million and will boost Dorchester Pacific’s total loan book to a value of around $90 million.

Oxford has reach through Wellington, the Wairarapa, Taranaki, Hawkes Bay, Waikato and the Bay of Plenty, with 75 percent of its book tied up in motor vehicle financing and the remainder in consumer loans.

The acquisition is the latest in a series by Dorchester. Last year the company upped its holding in Turners Auctions to a cornerstone stake and in 2012 it bought Napier-based debt collection agency EC Credit for $18.5 million in cash, stock and earn outs.

Oxford Finance has “scale to boost group earnings quite significantly and there is a low integration risk,” said Grant Baker, Dorchester’s chairman. “We have acquired the business on a similar earnings multiple to our EC Credit acquisition and we are very comfortable with the value proposition.”

It expects Oxford Finance will contribute $3 million to annual earnings, boosting forecast annual net profit to between $10 million to $11 million in 2015, and up to $15 million the following year. Last November the company gave annual guidance of $6 million trading profit for the period ending March 31.

Shares in the NZX listed company rose 2.1 percent to 24.5 cents, and have climbed 9.1 percent since Jan 1, although they have fallen 16 percent over the last 12 months, underperforming the NZX All Shares Index’s gain of 9.6 percent.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Research: ‘Ageing Well’ Science Challenge Launched

Science and Innovation Minister Steven Joyce today launched the Ageing Well National Science Challenge, confirming initial funding of $14.6 million. More>>

ALSO:

Scoop Business: Govt Resisting Pressure To Pump More Cash Into Solid Energy

Prime Minister John Key says it is “not the government’s preferred option” to make a fresh capital injection into the troubled state-owned coal miner, Solid Energy, but dodged journalists’ questions at his weekly press conference on whether that might prove necessary... More>>

ALSO:

Lagest Ever Privacy Breach Award: NZCU Baywide Accepts “Severe” Censure In Cake Case

NZCU Baywide says that once it was found to have committed a breach of a former staff member’s privacy, it had attempted to resolve the matter... the censure and remedies for its actions taken almost three years ago are “severe” but accepted, and will hopefully draw a line under the matter. More>>

ALSO:

Scoop Business: PayPal Stops Processing Mega Payments; NZX Listing Still On

PayPal has ceased processing payments for Mega, the file storage and encryption firm looking to join the New Zealand stock market via a reverse listing of TRS Investments, amid claims it is not a legitimate cloud storage service. More>>

ALSO:

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news