A rebranded Geneva Finance is planning to raise $1.5 million in a rights issue next month.

Now operating as GFNZ Group, the NZAX-listed finance company, put into moratorium five years ago, will be issuing 56.2 million shares at 2.75 cents.

Managing director David O'Connell says the money raised will contribute to a scheduled $5 million repayment to debenture investors in September and extend its lending in the car finance market.

Geneva was the first finance company to enter moratorium, in November 2007, owing $132.4 million to investors.

Now operating as GFNZ, it has been one of the more successful financiers to survive the sector’s collapse, and has repaid $127.2 million, which includes interest, to investors.

Financial services group Federal Pacific (FedPac) took a cornerstone stake in the company in March, paying $1.2 million, or 2.75c apiece, for 45 million shares (a 19.9% stake).

FedPac, which has ties to Ireland's Fexco, will underwrite a four-for-one rights issue to existing shareholders at 2.75c per share.

Takeover panel approval is being sought for the underwrite, which is also subject to shareholder approval at next month’s shareholders meeting.

Mr O’Connell says Geneva has been working hard to reposition itself since its funds were frozen and Fed Pac’s investment had been crucial.

“FedPac’s continuing support is a significant step in allowing the company to source new funding which is core to expanding the new business model while maintaining our scheduled debt repayment programme.”

Geneva shares last traded at 2.2c, valuing the company at $4.943 million.

The Financial Markets Authority ordered Geneva to stop borrowing from the public in June last year, after learning the financier had breached lending covenants with the Bank of Scotland.

Just months earlier, in March , Geneva convinced investors to swap debentures and notes in exchange for control of the company by trebling the shares at 5 cents a piece in its third capital reconstruction for the company.