FAST-GROWING equipment finance company RentSmart has expanded offshore in a joint venture with BankWest’s parent Halifax Bank of Scotland.
FAST-GROWING equipment finance company RentSmart has expanded offshore in a joint venture with BankWest’s parent Halifax Bank of Scotland.
The move into the UK will nearly double the size of RentSmart’s operations and managing director Ned Montarello anticipates further growth into Europe.
“We will have 52 people on the ground in the UK from May 5,” Mr Montarello said.
That compares with the 62 people that Perth-based Rent-Smart currently employs across Australia.
Mr Montarello said RentSmart would manage the 50:50 joint venture.
“It will be our software and our people,” he said.
HBOS will provide a $200 million wholesale funding facility to underwrite the rental contracts.
RentSmart featured recently in the 2003 Rising Stars Index, an initiative of WA Business News and Deloitte Touche Tohmatsu to highlight fast growing Western Australian private enterprises.
RentSmart pioneered a new market when it started in 1996, providing rental finance to help small businesses acquire computers and other office equipment.
Its proprietary software allows online credit applications to be processed in a matter of minutes, and also enables the group to manage a large number of low value transactions.
Mr Montarello said the UK was virgin territory for this type of product.
“We will be first to market. There is no comparable product in the UK market today,” he said.
He foreshadowed plans to link up with UK retailers, replicating its Australian business model. Its rental finance facility is currently available through more than 800 retailers, including Officeworks, Megamart and Dick Smith stores.
Mr Montarello, who spent four months in the UK last year setting up the joint venture, said the BankWest connection was incidental.
“We went with HBOS because they were the most aggressive and accepting and recognised the glaring gap in the market,” he said.
“It added credibility when they discovered we were transacting with BankWest already.”
Gareth Parry, director of Bank of Scotland Asset Finance, said: “what we saw in RentSmart is a business that is solely focused on satisfying the demands of an often neglected niche in servicing small ticket transactions for small business”.
Mr Montarello said Rent-Smart, which has been trading profitably for two years, would be able to finance its share of the UK joint venture from internal sources.
Mr Montarello, with a 61 per cent shareholding, is the biggest winner from RentSmart’s profitable growth, while other shareholders include Kerry Stokes’ private company Australian Capital Equity.
