Draft contracts issued for Refund sale

by Adam Smith19 Jan 2012

A sale may be nearing for beleaguered franchise outfit Refund Home Loans, with three offers for the business reportedly on the table.

A letter from the company's administrator, SV Partners, has advised franchisees that draft contracts have been issued to two of three potential suitors for the business, with a third draft contract expected to be issued as well.

The administrator told franchisees it is awaiting response on any amendments required to the contracts, and assured the company's creditors it will be in their best interests for negotiations with the buyers to run their full course.

"Whilst the terms of all three offers are different, we believe that all three offers will provide creditors and franchisees with a better result than if the company is wound up and a sale does not occur," the letter said.

The administrator had initially targeted a sale prior to Christmas, telling franchisees in a letter sent in early December that contractual terms could potentially be finalised within a week.

Related stories:

Refund brokers still eyeing bid

Refund eyeing sale before Christmas

COMMENTS

  • by sidbroker 19/01/2012 12:10:34 PM

    I hope the new owners have a business model in mind that is not based on under cutting every one else in the industry so they can do ok at the expense of everyone else. Given rising costs and less return i think the second refund model will fail as well if they go in the same direction. I can see no logic in any business that refunds and then goes broke. Surely this defies logic and if it did go in the same direction then that should send out warning signals for all to steer clear especially the lenders!!

  • by Daniel 23/01/2012 2:01:08 PM

    The business model did not fail.... the directors failed and completely mismanaged their cashflow and profits(yes it was very profitable). This is not a model that undercuts anyone. The model is using what everyone should be budgeting towards marketing as a 'refund' to the clients and it worked more so as a unique sales proposition than anything else. The refund was only 10% of the upfront comisison and NIL on the trail. Any competition is simply building consumer awareness of our industry as we create our own economic success or failure based on our faith on either outcome. For me, there is an abundance of opportunity and always will be!

  • by Melbbroker 23/01/2012 2:20:46 PM

    ill be glad to never see the name of refund home loans again and any similiar brokerage