Insured Group offers part payment to St George

BUSINESSDESK: Insured Group, which used Lombard Group for a backdoor listing on the NZX, has pulled its prospectus for ASX listing for the second time this year after saying it will only make a part payment on $A3 million due to St George Bank on September 30.

The Australian insurer “remains in discussions” with the lender, on the expectation St George will extend terms, the Perth-based company says.

It was intending to raise $A2.25 million in Australia, which it had hoped would lift its equity enough to satisfy the requirements for an ASX listing and it would delist from the NZX.

Today it says the Australian Securities & Investments Commission held up the prospectus and after questioning by the regulator the company concluded “that the nature of certain prospective transactions [was] too uncertain to enable to company to succinctly address the matters raised”.

“The company has formally withdrawn its application at this time to seek quotation on the Australian Securities Exchange,” it says in a statement from managing director Wayne Miller, whose hospitalisation yesterday was cited as a reason for the delay in the announcement.

It is the second time this year the ASIC has blocked Insured Group’s prospectus. The original version was lodged in May, then withdrawn. A new prospectus was lodged on July 23 but again has failed to satisfy ASIC.

Australia’s St George Bank is the company’s financier and biggest creditor, and the payment due by the end of next month may be another test for the company.

“At present no terms exist to extend the facility beyond that date but extensions have been provided in the past as part of the company’s continued reduction in the facility amount,” Insured Group says.

The shares were lifted from a trading halt in New Zealand though they have not traded today. They were last at 4 cents and have jumped 100% on the NZX this year.

The funds raised were also meant to repay debt.

“The money would have been used to reduce general loan facilities, but in the absence of this fundraising the board considers that the company remains solvent,” it says.