Pioneer set to change hands

Pioneer Credit has disclosed it is just days away from announcing a preferred bidder for the troubled financial services business.

Addressing shareholders at today’s annual meeting, chairman Michael Smith said the company was in negotiations with multiple parties and expected to finalise a transaction in the near term.

“In the coming days we expect to decide on and notify a preferred bidder and then move to a recommended transaction for shareholders that will enable the realisation of value for all,” he said.

The prospective sale of the business comes after a tumltuous year for Pioneer, triggered by a change to the accounting treatment of the impaired loans it buys from bigger lenders.

The shift from ‘fair value’ to ‘amortised cost’ adversely affected Pioneer’s financial results and led to breaches of its banking covenants.

The company appointed Azure Capital earlier this year to run a dual process, assessing proposals to buy the business or provide new funding.

Mr Smith said Pioneer was not the only company in its sector to be affected by reduced access to debt funding from the big four banks.

He said a number of the big four banks have withdraw from funding the sector generally.

Mr Smith told shareholders that Pioneer continued to focus on running its business effectively.

“While from a corporate perspective, recent months have been disappointing, intense and stressful, the business has remained focused on achieving good outcomes for our customers,” he said.

“It has and continues to do that and Pioneer remains the only significant purchaser in the market that has never had a negative outcome determination from the Ombudsman.”