A Firstfolio director has acquired the company’s $29 million debt facility from CBA and is keen to pursue new business.
Firstfolio announced yesterday that it has entered into binding documentation with Welas Pty Ltd and CBA in relation to the acquisition by Welas of the company’s existing $29 million debt facility from CBA.
The ASX announcement noted that Welas is a company associated with Firstfolio director and substantial shareholder Tony Wales.
Firstfolio and Welas have also entered into binding documentation under which, immediately after completion of the acquisition, the maturity date of the assigned facility will be extended to 7 July 2016.
On completion of the acquisition of the assigned facility, and given the $29.3 million of subordinated loans currently provided by Welas to the company (subordinated facility), Welas is now Firstfolio’s sole senior debt provider.
Commenting on the acquisition, Mr Wales said that he was delighted to continue his ongoing financial support of the company, which, with a materially strengthened financing structure, is now well placed to pursue growth opportunities.
“I am a committed long-term shareholder and financier to Firstfolio”, Mr Wales said.
“Given the ongoing consolidation and evolution of the financial services sector, I believe the company is well financed to build on its market position and support its customers by delivering innovative financial service solutions,” he said.
Mr Wales’ comments were echoed by Firstfolio chairman Eric Dodd.
“This places the company on a strong financial footing to pursue new growth opportunities while enabling Firstfolio to reduce its debt in a measured manner over time,” Mr Dodd said.
“Firstfolio has a very strong nationwide mortgage broker network with one of the leading online non-bank mortgage providers in eChoice, which provides tailor-made solutions to clients through its innovative technology,” he said.
“The consolidation of our debt facilities and extension of the maturity of the Assigned Facility means we are very well placed to consider new alliances and build on the $18 billion in loans under management across the company.”
Welas will be the company’s first ranking senior secured debt provider for the total amount of approximately $58.3 million.