An Australian insurance claims management company has sold its New Zealand subsidiary to a multinational claims manager for up to $25 million.
Stream Group will receive an upfront payment of $7 million for Gallagher Bassett’s purchase of Symetri’s operating business and most of its assets, with additional earnings of up to $18 million based on profit through to December 2018, Business Desk reported.
Stream will retain possession of its subsidiary Symetri Technology as well the intellectual property used in Symetri claims management business, which it will license to Gallagher Bassett.
In December 2015, Stream’s Australian operations went into voluntary administration following problems raising funds and extending a key client contract with RACQ Insurance. It was put into liquidation in April 2016, and also sold its UK operations.
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The NZ subsidiary was the Stream’s largest and most profitable unit, and has kept the company’s cash flow positive after exiting its UK and Australian businesses, the report said.
Stream announced last July that it planned to raise A$1 million in funds by selling convertible notes to existing shareholders and was expecting to lodge first-half earnings the following month. Instead, its failure to pay for its annual listing got it suspended from official quotation on the ASX in August 2016, and it was unable to file earnings on the ASX. The shares last traded at 7.8 Australian cents, Business Desk said.
After the deal with Gallagher Bassett has been concluded, Stream’s assets will comprise almost exclusively of its ownership of Symetri Technology’s BuildAssist and Qusul software, and the cash from Symetri’s sale. The sale would boost Stream’s total assets from A$8.3 million to A$12.1 million on a pro-forma basis, while liabilities would drop from A$4.6 million to A$3.9 million, the report said.
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