Mortgage Link become broker controlled
Mortgage Link New Zealand founder Roger Poulter has sold his 34% stake in the company to its licenced brokers and staff and some new licensees.
Monday, January 26th 2004, 7:49AM
by Jenny Ruth
The move follows Poulter’s decision last July to step aside from the role of general manager and the sale then of Graeme Dick’s 24% stake to the licencees.
Ross Butler, who is acting as chief executive until new appointee Rod Templeton takes over in early February, says Poulter’s sale means the company has more than 50 shareholders, 35 of them licencees.
The sale price, which is confidential, was determined by an independent valuation by accountancy firm KPMG. Demand from the brokers was such that the shares on offer were 2.5 times oversubscribed, Butler says. When Dick sold his stake, demand was 1.8 times the number of shares available.
Butler says the share sale is part of a wider restructuring of Mortgage Link aimed at getting the brokers more involved in business planning and strategy.
As part of that, the company is introducing more rigorous corporate governance structures and will be appointing an independent director with the view that that person will eventually become chairman.
The directors currently are Butler and licencees Phil Christmas (who also helped found the company and has been a shareholder from the beginning) and Charlie Reid.
Poulter says that after Dick sold his stake, "I thought it would be an excellent opportunity for Mortgage Link if it became 100% broker-owned." As he is no longer involved in the day-to-day running of the company, he also thought it better to concentrate on other investments which include Pacific Home Loans and Eagle Finance, which provide loans to Mortgage Link brokers. Poulter, 53, also has one eye on retirement.
Butler says that with the brokers now being owners with "a real say in running the business," implementing strategies in future will have an automatic buy-in from them.
Because some staff put up their hands for shares, the company had to be particularly careful that they understood the full ramifications of owning the shares, including the risks involved, he says.
While the sale is effectively a done deal, there are still some administrative processes required to comply with securities and company law and Mortgage Link’s own constitution.
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