Heartland Group Holdings (NZX:HGH) re-evaluates the investment valuation in Harmoney

  • November 20, 2020 10:17 PM NZDT
  • Team Kalkine
Heartland Group Holdings (NZX:HGH) re-evaluates the investment valuation in Harmoney

Summary

  • Heartland Group made an initial investment in Harmoney in September 2014 before the launch of the online direct personal lender's platform and brought Trade Me Limited as a fellow shareholder in January 2015.
  • Harmoney Corp, which already has a foreign listing on NZX got listed on ASX recently, after it successfully raised around NZ$100 million from investors.
  • Heartland Group is now reassessing the fair value of its equity investment in Harmoney Corp Limited alongside a range of other factors that also include escrow restrictions.  

On 19 November, Heartland Group Holdings Limited (NZX:HGH) advised that it is reassessing the valuation of its equity investment in Harmoney Corp Limited (ASX:HMY).

On 20 November, Heartland Group last traded flat at NZ$1.39.

Heartland owns 8,518,864 ordinary shares in HMY, representing 8.44% of HMY's total shares on issue after the IPO and has entered into escrow limits disallowing the removal of its shareholding until the occurrence of certain events.

As part of the planning of its financial statements for 6 months ending on 31 December 2020, Heartland will reconsider the fair value of its equity interest in HMY.

Heartland will consider the market value of HMY securities alongside several other related variables, including the restrictions on escrow in finding out the fair value. This can lead to an increase in the investment's market valuation.

Trade Me investment in Harmoney welcomed by Heartland in 2015

Heartland’s initial investment was made in September 2014 before the launch of Harmoney Corp Limited platform.

On 12 January 2015, Heartland welcomed Trade Me Limited as a fellow stakeholder taking away 15% stake in Harmoney after completion of NZ$10 million capital raising by HMY.

Let's have a look at recent events happening with Harmoney Corp Limited.

HMY's listing on ASX and respective stakes of companies in the firm

Harmoney Corp Limited was the first peer to peer lender of NZ in 2014. The online direct personal lender, which also has a foreign listing on NZX got listed on ASX, on 19 November after it successfully raised about NZ$100 million from investors.

Harmoney Corp Limited has its principal stock market listing in Australia after raising A$92.5 million in its initial IPO at A$3.5 per share.

As per HMY, the IPO was well supported by institutional and retail investors across Australia and NZ with applications surpassing IPO offer size of which about A$70 million would be used to fund HMY’s growth.

David Stevens CEO and MD of Harmoney stated that the ASX listing was a significant milestone in fast-tracking growth across Australian and NZ markets. He added that the growing nature of the Australian and New Zealand personal finance market symbolises an extremely attractive growth prospect for Harmoney.

Harmoney also stated that for all significant existing shareholders, including Founder, Neil Roberts and CEO, David Stevens, voluntary escrow provisions are in place, with 72.3% of the total shares on issue to be subject to voluntary escrow provisions.

Prior to the capital raising, Harmoney founder Neil Roberts was still listed as the largest individual stakeholder with 27.5% stake, while Heartland Group, Trade Me, Kirwood Capital (Australian private equity company) and Andrew Lookman, Nelson/Tasman-based investor, each held interests of more than 10%.

On 20 November, Harmoney Corp last traded on ASX at A$3.48, up by 0.869% from its last close.

 

 


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