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Firstfolio gets debt boost from shareholder and CBA

by Nick Bendel10 minute read
The Adviser

Firstfolio has bought itself time after agreeing a $29 million debt deal ahead of a looming debt deadline of July 7.

The financial services group had been pursuing new sources of funding after ending the calendar year with $60.5 million of debt.

Firstfolio announced last week that its main lender and a major shareholder had come to its rescue.

The Commonwealth Bank has agreed to refinance and extend the maturity of Firstfolio’s $29 million debt facility – less than a month after granting an extension until July 7.


The refinancing will be done by Firstfolio’s subordinated debt provider, Welas, which will lend the company a further $29 million to repay the Commonwealth Bank.

The Welas debt will become payable two years from the date of the advance of the new loan.

Welas is a company associated with Firstfolio director and shareholder Tony Wales and already provides the company with $29.3 million of subordinated loans.

It will now become the company’s senior debt provider and secured creditor.

Firstfolio chairman Eric Dodd said the two-year debt deal would give the board greater flexibility in considering options to improve the balance sheet.

“This refinancing will address Firstfolio’s immediate funding needs and allows us to confidently pursue opportunities with our business partners and broker network, and implement a debt reduction program over time without the pressure of our existing debt facilities reaching maturity in the near term,” he said.

“Consequently, the company is now well placed to implement a refinancing plan which best protects and enhances shareholder value and provides the opportunity to maximise the benefit of growth opportunities.”

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