Warehouse offloads Money
The Warehouse is to sell its financial services division to SBS and Finance Now for $18 million.
Monday, July 24th 2017, 3:48PM
It has been offering house, life and travel insurance under the Warehouse Money brand, and a credit card.
In a statement today, SBS said Finance Now had been conducting due diligence for the past few weeks, and, subject to the finalisation of formal documentation, the sale was expected to be completed within five weeks.
It said the sale expanded an existing working relationship between The Warehouse and the SBS Banking Group, of which Finance Now is a subsidiary.
John Ward, chair of the SBS Banking Group said, “this transaction is a positive development for the SBS Banking Group and in particular Finance Now. We look forward to continuing our long-standing and well established relationship with this strong New Zealand brand.”
The Warehouse said it would continue to sell Finance Now services under its own brand.
The purchase does not include Diners Club New Zealand. More details will be provided at the time of the settlement of the transaction.
The Warehouse said the deal was likely to mean a $16m write-down in its annual result in September but would allow it to focus on its retail business.
Last year, the retail giant reported a below-expectation performance from Warehouse Money.
The Warehouse spent $7.3m buying Westpac out of a joint venture offering credit cards to Warehouse customers, but the deal hadn't yet lived up to expectations, shareholders were told.
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