EC Credit Control to stay put Dorchester chief

Dorchester Pacific chief executive and executive director Paul Byrnes says there is "absolutely no chance" EC Credit Control will be moved from Hawke's Bay.

"It's a competitive advantage - the quality of staff they are able to retain and the overall cost of doing business there," he said. "Even with collections out of Australia it makes sense. There is absolutely no chance the business will be relocated - there will just be a bit more flying to Auckland."

The purchase of Hawke's Bay-based EC Credit Control by publicly listed EC Credit Control for $18.5 million was announced last week. It was established in Napier in 1989 and grew to become the largest privately owned debt-recovery business in Australasia.

Its head office is in Napier, where it employs about 150 staff and contractors, and it has offices in Sydney, Melbourne, Brisbane and Perth.

The business was owned by interests associated with its managing director, Matthew Harrison, of Napier.

About 60 per cent of the purchase will be paid in cash with the balance in Dorchester shares. About $8 million of the $18.5 million will be determined in an earnout arrangement over two years with a final payout based on earnings achieved in that period.

The idea for the purchase started about a year ago after Dorchester approached the company to chase some debts, Mr Byrnes said.

"As part of that discussion - and we did place some business - we got to know Matt's business and were pretty impressed with it. Initially we said we would be interested in taking a smaller shareholding, but that has evolved.

"Matt was also quite interested in the Dorchester story, about the turnaround and recovery, and said he would like to be part of a bigger entity and part of that growth.

"His confidence is reflected in the fact that he has taken a good percentage of the consideration in shares. If we paid out the full $18.5 million, $7.5 million would have been issued in shares - that's pretty unusual for an acquisition of this sort."

He said Mr Harrison would remain active in Dorchester after the earnout period.

"Part of the value proposition for the business for us was Matt continuing to run the business and also joining the board. Certainly, we see him as staying with the business, managing and growing EC Credit Control but also contributing to Dorchester as a director - we're impressed with what he has done."

Mr Byrnes said he was looking forward to down-time during future visits to Hawke's Bay, saying its location was "a very positive aspect" of the acquisition.

"I love the area and I have a real interest in wine - I look forward to getting out to some of the wineries."