PF Group - Case Update

Adam Colley, Derrick Vickers, Stephen Longley and Andrew Scott of PwC, the voluntary administrators of PF Group Holdings and PF Management Holdings — the parent companies behind private debt collecting giant Panthera Finance — have released a report outlining what led to the companies’ financial troubles and recommending that creditors accept a DOCA proposal from the shareholders of PF Group Holdings.

The companies were incorporated in November 2017 as non-trading holding entities for their subsidiaries, which operate one of Australia’s largest debt buyer and debt collection businesses. The group’s purchase debt ledger (PDL) collections business, which is headed by Panthera Finance, made up 84% ($102 million) of its revenue in FY24.

The companies do not themselves have employees, own property or hold rental leases. However, at the time of the administrators’ appointment, the subsidiaries employed approximately 207 full time employees across offices in Brisbane, Melbourne and Echuca.

The companies have been loss making since fiscal 2022 as a result of material PDL impairments, lower than forecast collections and an increasing cost base relative to revenue. Corporate governance issues, regulatory issues (including the imposition of fines) and shareholder disputes impacted the companies’ strategic responses to key issues. In addition, the Covid-19 pandemic directly impacted the group’s debt collection activity.

Countering the loss-making position, the group had been generating strong positive operation cash flow until the decision was made to place Gedda Money (its consumer loans business) into wind down in November 2023. The group’s cash position declined from this point onwards, but there remained sufficient liquidity to meet ongoing liabilities up to immediately prior to the appointment of administrators on 26 June 2024.

The administrators have completed various sales since their appointment, including the sale of the Gedda Money subsidiaries to Gamma Duo Financial Services on 11 November 2024 and the Panthera Finance subsidiaries on 19 December 2024 to FCG Management Holdings.

The administrators received a DOCA proposal from shareholders HJK Investments and HMB Investments. The DOCA provides for a deed fund of approximately $463,000 comprised of all of the companies’ assets, including the entire cash at bank and the proceeds of the Gedda Money and Panthera Finance sales. In addition, a deed contribution of approximately $52,000 is to be paid by the shareholders.

The meeting to vote on the DOCA took place on 13 February, but the results of the meeting have not yet been revealed. As a result of the previous sales, creditors and employees of the Gedda Money and Panthera Finance subsidiaries were not entitled to participate or vote at the meeting.

Read the administrators’ report here.