- Heartland Group Holdings (HGH) is an acquiring an Australian agricultural business
- The New Zealand-based financial services group is acquiring a full interest in StockCo Australia Management
- StockCo Australia specialises in livestock finance for cattle and sheep farmers across Australia
- The company has $341 million worth of total assets and a position in the market, estimated to be $7 billion
- The total acquisition cost is $143 million, plus a potential top-up of $11 million based on specific performance metrics
- Heartland Group Holdings opened the day trading at $2.09
New Zealand-based financial services group Heartland Group Holdings (HGH) is an acquiring Australian agricultural business StockCo Australia Management.
StockCo Australia specialises in livestock finance for cattle and sheep farmers across
Australia.
The company has $341 million worth of total assets and a position in the market estimated to be $7 billion.
The total acquisition cost is $143 million, plus a potential top-up of $11 million based on specific performance metrics being achieved in relation to the new operational funding facility.
Heartland is buying the business from the two current shareholders, Australia Holdings Limited and Elders Rural Service Australia, which own an a 70 per cent and 30 per cent stake respectively.
The company says the acquisition is in line with its strategy of providing “best or only” products delivered through scalable digital platforms. It broadens Heartland’s Australian offering in an area where it already has expertise.
StockCo Australia’s livestock finance business will add to Heartland’s existing $1.2 billion Australian Reverse Mortgage business which has the largest market share of active participants.
Heartland currently provides various rural loan options in New Zealand, including online finance for sheep and cattle farmers, and livestock finance similar to that of StockCo Australia.
Heartland intends to fund the total acquisition cost in the short term through new debt facilities provided by a major Australasian financial institution.
The transaction is expected to contribute additional annual net profit after tax of $10 million to $12 million, before any ongoing cost of acquisition debt funding.
Heartland Group Holdings opened the day trading at $2.09.