Auguste Holdings, which is related to St Laurence sold its 19.47% stake in Dorchester to The Business Bakery, a limited liability partnership founded and managed by Grant Baker, Geoff Ross and Stephen Sinclair, for $400,000.
Recently a subsidiary of the Bakery, Macrocarpa Holdings, purchased the Investment Research Group (IRG) Portfolio business, which it is now operating as Foundry Asset Management.
The Bakery believes that while Dorchester has had its challenges, there are opportunities in the offing in the financial services space that a well capitalised Dorchester could take advantage of.
Baker says: "We think it's a sector with opportunity. Obviously it hasn't gone well recently, but we believe in the future there is still going to be a requirement for that type of lending. I think it's a business you could do very well in if you ran it properly and we think Dorchester is a good vehicle to do that in."
Baker says it has been better run than the majority of finance companies and has a plan to repay debenture holders 100 cents in the dollar, in comparison to others paying less than 50 cents. As well as its Dorchester Finance subsidiary, it also has profitable insurance and reverse annuity mortgage offerings, he says. Baker himself has some knowledge in the finance arena, having had a $130 million equipment finance book under his authority while chief executive at the Blue Star Group.
Despite the recent extension of the Government deposit guarantee scheme, Baker believes the best opportunity for finance companies going forward is to get a credit rating and to be able to stand alone.
"I think it's more about getting a credit rating and having the business well capitalised and running it properly," he says.
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