Property financier Strategic Finance gave its 20,000 investors some good news yesterday with the announcement of a management buy-out backed by BOS International, a subsidiary of Halifax Bank of Scotland.
Strategic chief executive Kerry Finnigan said the original owners, senior management and BOS International had agreed terms with Allco HIT Ltd to buy the investment group.
The consortium team included executive directors Graham Jackson, Jock Hobbs and Marc Lindale, as well as Mr Finnigan.
Strategic Finance has been owned by listed Australian investment fund Allco HIT and owes more than $500 million to about 20,000 investors.
It was founded in 1999 and run by Mr Hobbs, a former All Blacks captain, now chairman of the New Zealand Rugby Union.
He remains an executive director of Strategic.
Strategic Finance's ownership has been subject to speculation since Allco HIT's controlling shareholder, the investment bank and funds manager Allco Finance Group, announced a major strategic review this year amid discussions about its own bank funding lines in the wake of the global credit crunch.
Allco bought 50% of Strategic in May 2006 and bought the following 50% last year for $225 million, in a deal that saw ownership move to Allco HIT, the listed investment trust.
Mr Finnigan said that despite the difficulties facing the New Zealand finance company sector, the proposed ownership change of Strategic should ensure its long-term future.
"We have always remained fully engaged with the business and firmly believe in its future prospects.
"Despite current market conditions, history has shown that the need for strong finance companies in New Zealand will not disappear.
"We have every confidence that the change of ownership will ensure that Strategic Finance will be one of the companies servicing this need."
Key to the consortium acquisition was that BOS International would also increase its existing wholesale facility in Strategic to $150 million, he said.
That further diversified Strategic's reliance on debenture funding and the consortium intended to look for new products to offer to the market.
BOS International chief executive Jack Dykes said in a statement the bank had a strong relationship with Strategic.
"They have quality management which we believe can take advantage of opportunities emerging from the current market turmoil in this sector and are pleased to strengthen our relationship."
BOS International and HBOS Australia are members of the HBOS Group, one of the world's largest financial services organisations providing retail, business and corporate banking and insurance and investment services to more than 23 million customers.
