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.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Scoop Business: A Decade Of Government Pre-Seed Investment

More publicly-funded science is being commercialised after a decade of government ‘pre-see’d investment, according to an independent review. More>>


Solid Energy: Plan To Shut Unprofitable Huntly East Mine

Solid Energy, the state-owned coal miner in voluntary administration, plans to shut down its unprofitable Huntly East mine and lay off 65 staff after deciding the site stands "no chance whatsoever" of finding a buyer. More>>


E Tū: Merger Creates NZ's Biggest Private Sector Union

E tū has been created by the merger of the Engineering, Printing and Manufacturing Union and Service and Food Workers’ Union. It represents more than 50,000 working New Zealanders in industries as diverse as aviation, construction, journalism, food manufacturing, mining and cleaning. More>>


Internet: NZ Govt Lifts Target Speeds For Rural Broadband

The government has lifted its expectations on faster broadband speeds for rural New Zealand as it targets increased spending on research and development in the country's information and communications technology sector, which it sees as a key driver for export growth. More>>


Banks: Westpac Keeps Core Government Transactions Contract

The local arm of Westpac Banking Corp has kept its contract with the New Zealand government to provide core transactions, but will have to share peripheral services with its rivals. More>>


Science Investment Plan: Universities Welcome Statement

Universities New Zealand has welcomed the National Statement of Science Investment released by the Government today... this is a critical document as it sets out the Government’s ten-year strategic direction that will guide future investment in New Zealand’s science system. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news