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GE Capital buys half of SCF's Face Finance loan book

GE Capital buys half of Face Finance loan book in SCF receivership

By Paul McBeth

May 23 (BusinessDesk) - GE Capital’s local equipment finance unit has bought more than $100 million of Face Finance Ltd.’s loan book assets from the South Canterbury Finance Ltd. receivership.

The American lender is the first buyer of any of SCF’s loan books, snapping up half of its total loan book of $200 million. SCF owned about three-quarters of Face Finance, which focuses on commercial plant and equipment lending, was put on the block in February.

Face Finance, which is also owned by Warren Baxter and Tim Murphy, had a loan book worth $197 million after impairments, as at Aug. 31, and total assets worth $205 million, according to its first receiver’s report. Stripping out the $197 million loan from parent SCF, the receiver estimated net assets worth $8.2 million.

The deal comes after receivers Kerryn Downey and William Black of McGrathNicol secured buyers for SCF’s stake in horticulture and primary sector processing company Scales Corp. and Helicopters (NZ) Ltd. for some $200 million.

“The sale to GE Capital is a very pleasing outcome and represents a key milestone in the realisation of South Canterbury Finance’s loan book assets,” Downey and Black said in a statement. “We believe the acquisition by GE Capital will provide increased certainty for Face Finance’s customers.”

SCF’s consumer, business and rural lending divisions and subsidiary Southbury Insurance were put on the market last month. The three loan books were collectively valued at $939 million in the first receiver’s report, almost two-thirds of the $1.56 billion face value of SCF’s loan assets. Southbury has 7,600 active life and vehicle policies, with net assets of some $1 million.

Deutsche Bank AG’s local branch acted as sale adviser to the receivers.


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