27/02/2012 - 15:38

GCU spends $2m on $9m listing plan

27/02/2012 - 15:38

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GCU spends $2m on $9m listing plan

Goldfields Credit Union has lodged a prospectus ahead of its long-awaited stockmarket float, revealing that it will spend $1.86 million to demutualise and raise $9 million in new capital.

The Kalgoorlie-based credit union plans to use the proceeds of its capital raising to strengthen its balance sheet, to support increased lending and growth outside of the Goldfields region.

The prospectus shows that GCU, to be renamed Goldfields Money, has been consistently profitable, although recent profits are well below the peak.

It achieved an audited net profit of $348,000 in 2010-11, down from $702,000 in 2007-08.

In the current financial year it anticipates a net profit of $409,000.

Its profit in both years will be affected by demutualisation expenses, which will total $703,000.

In addition, the credit union expects total costs of $1.16 million associated with its capital raising and ASX listing.

The main beneficiaries include the lead manager and underwriter Patersons Securities, which will be paid an underwriters’ fees of $450,000. This is equal to five per cent of the gross proceeds, which is standard practice.

CGU will also pay $436,000 in legal fees; Clayton Utz is listed in the prospectus as legal adviser.

The credit union’s proposed chief executive is another major beneficiary. David Holden, who previously worked at StateWest Credit Society, will be paid $345,000 in consultancy fees, prior to commencing as chief executive on a $230,000 salary.

Mr Holden, along with HBF managing director Rob Bransby, plan to join CGU’s board, which is chaired by Allan Pendal.

 

 

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