Battling financier and rural services provider Allied Farmers has repaid its term loan facility with Westpac in full and reached agreement on outstanding debt to collapsed subsidiary Allied Nationwide Finance.The company repaid the loan out of proceeds fr
Battling financier and rural services provider Allied Farmers has repaid its term loan facility with Westpac in full and reached agreement on outstanding debt to collapsed subsidiary Allied Nationwide Finance.
The company repaid the loan out of proceeds from the sale of former Hanover and United Finance assets acquired last December.
Allied’s senior debt to Westpac was recorded at $16.5 million at June but was then reduced to $1.65 million after Allied negotiated early settlement on a sale of its acquired Queenstown Five Mile development and received $3.75 million from the receivership of the Maison Reeves Condominiums in the US.
Allied also announced today it had reached an agreement with Allied Nationwide (in receivership) around its existing debtor factoring, credit enhancement and related party loan arrangements.
Allied Farmers had previously sold $20.9 million worth of debt factoring arrangements between subsidiary companies to Allied Nationwide Finance, which was assigned to the rural business.
Allied Nationwide had full recourse against Allied Rural under those agreements.
Under the new agreement Allied Farmers will convert the existing arrangements into secured loan facilities with Allied Nationwide Finance.
“This agreement provides Allied Farmers assurance around its funding arrangements over the medium to long term and aligns with the company’s forecasts for its operating businesses and non-core asset realisations,” outgoing managing director Rob Alloway said in a statement.
Allied Farmers took over the assets and loans of Eric Watson and Mark Hotchin’s Hanover finance companies in a debt for equity swap last December.
The company has since written down the value of the loan books from $396.2 million to $94.3 million.
In 2008, the Hanover and United assets were valued at $516.6 million.
Allied’s annual report showed a pro forma loss of $79.1 million for the year to June.
However, the company's auditor PricewaterhouseCoopers was unable to verify the company’s financial statements and could not form an opinion on its going concern status.
