The aggregator said it will pay Welas – the provider of the senior debt facility – an extension fee of 50 percentage points of the facility size, as well as reimbursement of legal costs.
Welas is a company associated with eChoice non-executive director and shareholder Tony Wales, and was previously classified as eChoice’s (known then as Firstfolio) subordinated debt provider after loaning the group $29.3 million.
Peter Andronicos, chief executive of eChoice, said the facility extension reflects the group’s confidence in Welas as well as its own growth strategy.
“Welas’ ongoing support enables us to build on the early positive signs of the business rebuilding process and our revenue diversification program,” he said.
“This has allowed us to re-sign and extend our partnership with Fairfax’s Domain. We have successfully launched our eChoice broker graduate program and further developed our lead generation, retention and databased monetisation programs.”
Mr Andronicos said these programs are currently being utilised internally by eChoice and are scheduled to be rolled out to third-party financial institutions in the coming months.
He said the facility extension also provides eChoice with more flexibility to realise the full potential of the group’s assets under its three-year growth strategy.
“With the first two components of this strategy, the major restructuring of the management team and the elimination of non-core business programs completed, the business is now more focused and its internal resources are aligned to execute the company’s growth plans,” Mr Andronicos said.
The aggregator intends to make senior debt facility repayments of at least $5 million per year and investigate other corporate options that will enable additional early debt repayments.