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Private equity consortium Trans Tasman Collections is seeking to recover some of the $117 million it paid to Veda Advantage for debt collection services companylast year.
Dual-listed credit information company Veda Advantage, formerly known as Baycorp Advantage, sold its mainly New Zealand debt collection business to Trans Tasman Collections for A$97 million (then $117 million) in June.
However, Trans Tasman was now seeking to recover "a few million" after becoming aware of business issues that were not fully disclosed during due diligence, a source told the Business Herald.
The issues were not related to legal action against Baycorp Advantage by the receivers of failed car finance firm Provincial Finance.
Trans Tasman was seeking the money under "warranties and indemnities" in the sale agreement.
Neither Veda Advantage nor Trans Tasman would comment yesterday.
Trans Tasman is a 50/50 consortium comprising Deutsche Bank Capital Partners and Allco Equity Partners, the private equity firm involved in an A$11.1 billion bid for Qantas.
Allco also owns 17.7 per cent of Veda Advantage.
Baycorp, which began in Lower Hutt 50 years ago, merged with Australian credit-checking firm Data Advantage in 2001. Trans Tasman acquired Baycorp following Allco's unsuccessful takeover offer for BayCorp Advantage in late 2005.
Baycorp Advantage changed its name to Veda Advantage shortly after last year's sale.
