FlexiGroup buys 'complementary' Equico

FlexiGroup NZ has acquired the assets of Equico in a deal the Kiwi boss says will enable the company to better service customers, particularly resellers and retailers.

The deal, for an undisclosed sum, sees all of Equico's assets, including business systems, intellectual property and staff, plus the financial assets in the form of customers, transferred to FlexiGroup NZ, a wholly owned subsidiary of ASX listed financial services company FlexiGroup.

Russell Webber, FlexiGroup New Zealand general manager, says Equico, with its strong foothold in the education market, provided a 'great, natural fit' with FlexiGroup, which has traditionally focused on the SME and corporate market.

“The two businesses complement each other very, very well,” Webber says.

“When you bring the two together, you have a more diverse and comprehensive customer base with not a lot of cross-over.”

The combined company will have a customer base of around 30,000 unique customers.

Webber says Equico also has some 'great' systems around management of equipment at the end of lease which will help FlexiGroup improve its pricing of deals.

“They price their transactions a bit differently and take a bit more residual value risk than we do. Those skills will come across and we will be a better company from having those skills.

“It will also improve our ability to finance a more diverse range of equipment and assets. The team at Equico have very strong skills and knowledge in this area.”

Integration of the two companies has already begun, with full integration expected to be completed in June.

All nine Equico staff will transfer through to the combined business, with no job losses, making a combined New Zealand team of 51 – including 21 directly involved in sales and marketing.

“This will allow us to further specialise and improve focus on customers and in particular the reseller and retail channels,” Webber says.

He adds that the team will include specialists focused on the education market, others focused on corporate, and others able to focus on SME.

“The sales team is now 21 staff so there's the ability to focus and specialise in these vertical parts of the market.”

Webber says the Equico brand will remain, and will be used mainly for sales into the education sector, while the FlexiRent brand will continue to be the predominant brand for commercial sales.

He says the deal could also ultimately see the company expand its current reach, from predominantly technology leasing, into broader asset classes.

“We haven't made any specific decisions at this point, but we could see diversification to a broader range of equipment, maybe industrial, for example.

“[The acquisition] positions us very well for further expansion.”