15/06/2004 - 22:00

Homing in

15/06/2004 - 22:00

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Down here at WA Business News we thrive on the fact that national media generally forget Western Australia exists, leaving a convenient vacuum for us to fill – but even so I sometimes get amazed at what is missed by our peers in Sydney and Melbourne.

Homing in

Down here at WA Business News we thrive on the fact that national media generally forget Western Australia exists, leaving a convenient vacuum for us to fill – but even so I sometimes get amazed at what is missed by our peers in Sydney and Melbourne.

Last week for instance, I read a cover story in a national magazine that looked in depth at the mortgage broking industry.

The piece made mention that there was a four-way fight at the top of the mortgage broking industry among the top players, Mortgage Choice, Aussie Home Loans, Wizard Home Loans and Australian Finance Group.

That cursory mention was the only reference I could find for the only WA player in that foursome, AFG, a company which has a hand in about 10 per cent of all new housing loans across the country through its role between the mortgage brokers and the financiers.

AFG, which won one of our Rising Stars awards this year and is run by Brett McKeon, currently manages a loan book of around $17 billion.

To run salt into our wounds, a side story goes on to discuss those who have made a pile from the mortgage broking industry.

AFG remains ignored as the owners of the other three companies, plus the founders of RAMS Home Loans and Liberty Financial crack a profile.

Whatever happened to our very own Homeloans Ltd duo Tim Holmes and Rob Salmon, who would slip neatly into that company with their listed entity accounting for $4 billion in loans under management?

Homeloans started off life as WA Home Loans and, while a national player these days, cut its teeth in the WA market, which was the leader in this field and remains the most competitive in the country.

About 45 per cent of all home loans in WA have been originated by brokers, whereas Victoria is more like 20 per cent and New South Wales 30 per cent.

Of course, I don’t really know why I am getting bothered about this, the Homeloans lads certainly aren’t.

When I rang Mr Holmes for his comments on the issue, I all but woke him from his slumber at some holiday location in Italy.

He admitted he preferred the low profile and didn’t mind being missed by the national media.

Between the pair of them their interests hold about a third of Homeloans which, by my rough calculations, has a market capitalisation of about $15 million. So that’s about $2.5 million each in ordinary shares.

They also took up the bulk of a reset preference share issue earlier this year, taking up about $1.7 million each.

Mr Holmes said he remained confident that Homeloans could grow market share amid what was almost certain to be a major tightening of the market as the property sector cooled its heels.

Old faces

ON another share market related company, its worth looking across to page 9 to our story on Revenir, which is taking an 80 per cent stake in UK venture Bones in a $4.4 million deal.

There’s a couple of names that have come leaping out at me from the pages of recent biotech corporate history.

First and foremost is Glen Travers, who becomes a director of Revenir if the deal goes ahead.

Mr Travers got a lot of press in 1998 over revelations that he gained share benefits worth $33.3 million due to the conversion of options into equity when his company, Cortecs, switched its main listing from Australia to the UK.

Payments for his lifestyle, including $68,000 in helicopter flying training at the expense of the company, also became public.

A number of other interesting news items came out then, including his $2 million a year package – which would place Mr Travers among the top CEO salaries in Australia.

According to newspaper reports at the time, that package was defended by then Cortecs director and founder Leon Ivory who also bobs up in the Revenir/Bones deal, through a company called Bluewater Capital which, we are told, will have the management contract to run finance and administration at the merged company.

Not much of this is mentioned in any of the public announcements on the deal.

Mr Travers is simply referred to as an industry specialist. In his short biography it says he “founded and built a biopharmaceutical company to 350 staff – 200 in R&D ($500 million value on departure), listing in the UK, Australia and the US (Nasdaq).

One might presume this is Cortecs, though the company he headed is strangely not named even though there are a bunch of drugs and joint venture partners referred to that are.

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