Firstfolio Ltd today announced that it has entered into an agreement to acquire up to 100 per cent of online mortgage broker eChoice.
The acquisition includes eChoice’s $2.6 billion mortgage book and proprietary, online sales and processing platform.
Assuming the acquisition gains 100 per cent acceptance by the eChoice shareholders, Firstfolio will issue 60 million fully paid ordinary shares, subject to voluntary escrow conditions.
In addition there will be a deferred consideration element of $3 million, payable over four years, with an agreed share of the loan book trail receipts also payable over four years.
The transaction is scheduled to settle on the October 31 2008.
According to Firstfolio chief executive Mark Forsyth, the deal is the latest in a series of strategic acquisitions and partnerships completed as a part of Firstfolio’s strategy to build a large-scale, national distribution platform.
eChoice, he said, would offer a significant growth platform for the company’s products and additional scale to the group’s loan book, as well as introducing new borrowers and intermediaries into the group’s distribution network.
“eChoice is a dominant brand in the online mortgage broking space. The acquisition of eChoice will immediately position Firstfolio as a leader in the online mortgage sales segment. We believe the online segment has untapped potential in Australia, not only for mortgage distribution but for other financial products in Firstfolio’s portfolio,” Mr Forsyth said.
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