Heartland in trading halt as Quadrant looks to sell its 9% stake

1.Exterior view of Heartland House which is for sale at 35 Teed St, Newmarket.

Shares of Heartland New Zealand are in a trading halt as Quadrant Private Equity looks to sell its near 9 per cent stake in the bank, formed from the merger of Marac Finance with Southern Cross and Canterbury building societies.

The Australian private equity firm, via brokerage First NZ Capital, has put in a block order "in respect of the approximately 9 per cent" of the Christchurch-based lender, Heartland said in a statement to the stock exchange.

The sale comes after the escrow period for the block ended when Quadrant and its partners sold Seniors Money International to Heartland last year for $87 million, of which $38.7 million was in stock at 90 cents apiece.

Heartland shares last traded at $1.31, indicating a value for Quadrant's stake of $53.9 million.

The bank will stay in a trading halt until completion of the offer.

The lender is targeting expansion through niche markets, particularly in the consumer finance sector.

Last year it bought a reverse mortgage business from Seniors Money International, which counted Quadrant as its biggest shareholder.

It has also taken a 10 per cent stake in peer-to-peer lender Harmoney Corp for $3.5 million to accelerate growth.

The lender estimates its stake in Harmoney is now worth $5 million. Some $17 million has been lent through the online platform.