An investment group led by Sydney-based Duncan Saville is set to gain control of Homeloans, after the Perth-founded mortgage lender struck a takeover deal with competitor RESIMAC.
The merged group will have a loan book of about $13 billion and be a significant player in the non-bank lending market.
The deal is being implemented through a reverse takeover, with ASX-listed Homeloans planning to issue 285 million shares to acquire the Resimac business.
With Homeloans shares trading at 47 cents, that values the deal at $134 million.
Upon completion of the deal, Resimac shareholders will own 72.5 per cent of the merged group, with existing Homeloans shareholders having the balance.
The ownership split is opposite to the loan books of the two companies - Homeloans has a loan book in excess of $8 billion while Resimac has a loan book of $5 billion.
This implies Resimac has a more profitable business model.
Resimac’s major shareholder, Ingot Capital Management, will hold 57 per cent of the merged group.
Ingot is controlled by Mr Saville, who came to prominence nearly a decade ago when he gained control of Perth-based technology company ERG, which now trades as Vix Technology.
The board of Homeloans, including co-founder Robert Salmon, has recommended shareholders vote in favour of the deal.
The board has also received confirmation that Carol Holmes – the widow of co-founder Tim Holmes – and Perth investor Noel Kagi, who is a major shareholder, will vote in favour.
Resimac executive chairman and chief executive Warren McLeland will be managing director of the merged group, with a new independent chairman to be appointed after completion.