Superannuation services fintech OneVue has moved to appoint receivers over an outstanding $31 million from Sargon Capital, following the super infrastructure provider calling in voluntary administrators for its subsidiaries.
Sargon appointed administrators Stewart McCallum and Adam Nikitins of Ernst & Young to a number of its companies earlier this week.
This followed a creditor of Sargon, Hong Kong-based insurer Taiping Trustees appointing corporate advisory and restructuring firm McGrathNicol as receiver to the firm last week. Sargon stated the appointment related to debt facilities provided to it by Taiping.
But it also stated on Thursday that its business would be unaffected, with its management, board of directors and operational staff remaining in place.
The shift has come after the company bought one of Australia’s largest provider of super trustee services, Diversa Trustees, from its former owner, super service technology provider OneVue in a $45 million deal last year.
Both OneVue and Sargon had a pre-existing relationship, via Sargon’s ownership of Madison Financial Group, which supported OneVue’s platform and they did commit to exploring further business opportunities.
But Sargon is still yet to cough up a remaining $31 million, according to OneVue. The company on Tuesday appointed Chris Hill and Daniel Walley of PwC to act as its receivers and managers, saying they would protect its rights under its secured interest.
OneVue however, promised shareholders it would not be affected by the downfall of Sargon.
A statement made to the ASX from OneVue stated the firm understood Sargon’s Diversa trustee and regulated businesses are not in voluntary administration or receivership and continue to trade as normal.
“The receivers will be conducting an urgent assessment of the overall position with respect to Sargon and we will continue to keep the market updated as more information comes to hand,” OneVue said.
OneVue managing director Connie Mckeage said: “The business is appropriately funded and has the balance sheet strength, cash generating capabilities, cash on hand and debt facilities to support the growth and operating requirements of the business.”
“All outstanding amounts for acquisitions were fully extinguished in January 2020 including the final payment to KPMG for the acquisition of their superannuation administration business.”
The company has also kicked off a share buy-back program, saying its foreshadowed dividend remains subject to the outstanding payment from Sargon.
OneVue chair Ron Dewhurst said, “OneVue has been dealing with Sargon matters now for an extended period of time and without access to the $31 million. OneVue did take the opportunity to strengthen our position as a creditor of Sargon in November when the extension of the deferred payment was granted.”
“Although the high profile of this recent event is unfortunate it has not impacted our day-to-day operations nor do we expect it to in future.”
He added the growth trajectory of OneVue has showed strong potential across its fund and platform services, despite missing out on Sargon’s payment.
Sargon was founded in 2013. Now operating across Australia, New Zealand and Hong Kong, it has claimed to manage more than $55 billion in funds, across its corporate trust, responsible entity and retirement and super trustee services.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
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