ANZ sells UDC – again

ANZ has agreed to sell its asset finance business, UDC Finance Limited (UDC), for $762 million to Shinsei Bank, a higher price than that of the blocked 2017 sale to HNA.

Tuesday, June 2nd 2020, 11:46AM

Antonia Watson, ANZ

The sale follows a strategic review of UDC previously announced by ANZ, and is in line with ANZ’s strategy to simplify its business.

The purchase price represents a price-to-book ratio of 1.2x net tangible assets of $637 million as at March 31, 2020.

The sale will release over NZ$2 billion of funding provided by ANZ NZ, further strengthening its balance sheet position.

ANZ NZ chief executive Antonia Watson said the purchase of UDC by Shinsei Bank was a significant vote of confidence in the New Zealand economy.

“With a strong outlook for infrastructure and agriculture projects as the New Zealand economy rebuilds post-Covid-19, there is a significant role for UDC to play. As such, it needs an owner that can invest in and grow the business.”

Shinsei Bank Group is a diversified financial group with both banking and non-banking business divisions. Shinsei Bank Group operates both asset financing and vehicle and consumer lending businesses similar to those of UDC within Japan and offshore.

“Shinsei Bank intends to preserve UDC’s operations, retain UDC employees and provide long term capital to maintain and grow customer lending in New Zealand. The sale will also mean UDC will continue to operate as an independent finance company and enhance competition in the asset finance market.”

Shinsei Bank chief executive Hideyuki Kudo said: “I am very excited that UDC will become a part of the Shinsei Bank Group, in line with our non-organic growth strategy in this business area. In the Covid-19 ‘new normal’, we are confident that UDC, as part of Shinsei Bank Group, will continue to grow and contribute to the development of the New Zealand economy and help people and businesses in New Zealand with their financial needs.

“Based on UDC’s long successful history, solid business base and efficient sales structure, UDC will be a major asset for the Shinsei Bank Group.”

The UDC sale is subject to regulatory approval and completion is expected in the second half of the 2020 calendar year.

The Overseas Investment Office earlier rejected ANZ's bid to sell UDC to HNA for $660 million.

Tags: ANZ UDC