Homeloans Ltd looking at other acquisitions following Refund deal
ASX-listed non-bank lender Homeloans Ltd will look to acquire other broker networks following the acquisition of the $1.9 billion Refund Home Loans loan book and distribution network.
The purchase of the loan book, distribution network and assets of Refund Home Loans will be settled on June 8, after which Wayne Ormond’s Refund Home Loans brand, which once had around 350 loan writers, will disappear.
“The Refund Home Loans brand is tarnished and will no longer exist,” says Homeloans Ltd spokesman Scott McWilliam.
The purchase price has not been disclosed.
McWilliam tells Property Observer the Refund deal is a “distribution and acquisition play” for Homeloans Ltd, which is on the look-out for further ways to grow its brand and distribution network.
The acquisition will grow the current Homeloans Ltd book from around $6 billion to close to $8 billion while its current retail broker network of around 30 could soar to more than 160 should all of the remaining 135 Refund loan writers choose to sign up with the non-bank lender.
McWilliam says brokers that sign up with Homeloans Ltd will still have the option to offer customers mortgage refunds (paid from the commissions they receive) but says he does not expect many will continue do so.
“A lot of them would prefer not to and they don’t see as a selling point,” he says.
All current Refund Home Loans brokers will be given the opportunity to sign “branded broker contracts” with Homeloans Ltd.
Refund Home Loans branded cars and other marketing material will be rebranded with Homeloans Ltd, while brokers will also receive marketing support, lead generation support and the support of the Homeloans Ltd business development manager (BDM) network and company infrastructure.
“Brokers will continue to offer the same range of products and continue to aggregate under Choice. Homeloans Ltd are already a lender on the Choice panel,” says McWilliam.
The purchase is to be funded from Homeloans Ltd’s cash reserves.