Vehicle lender Geneva Finance said on Wednesday it had raised $1.66 million of new debt funding from 8 professional investors, enabling it to meet its own debt repayment programme ahead of schedule.
Geneva, owned by the NZAX-listed GFNZ Group Ltd, placed a further $2.075 million of new business receivables into its Prime Asset Trust Ltd funding scheme, using this security to raise the debt funding.
In response to a difficult funding market, Geneva developed the Prime Asset Trust funding product which offers investors a highly secure & high-cashflow investment opportunity. It’s only available to professional investors and the financing structure is completely independent of Geneva, which retains a subordinated position of up to 20% in the receivables but receives no cash from the investment until all investors’ principal & interest is repaid in full.
The company entered a 6-month moratorium in 2007 then won investor support for a reconstruction. It’s since repaid $134 million to investors, including interest at 11%/year to debentureholders, and reduced group operating costs by $29 million/year.
Federal Pacific Group Ltd (Alan & Alistair Hutchison, Auckland), a financial services firm operating throughout the Pacific region, became a cornerstone shareholder a year ago with a 19.9% stake.
Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.