Award-winning aggregator eChoice confirmed that Geoffrey Reidy and Andrew Barnden of Rodgers Reidy have been appointed as voluntary administrators of eChoice Limited and 13 subsidiary companies, pursuant to Section 436C of the Corporations Act.
The appointment was made by the secured creditor, Welas Pty Ltd, which has supported eChoice for many years but reached the view that it could no longer continue to support the aggregator in its current form.
Welas took the step to appoint the voluntary administrators to enable eChoice to assess its options on how to secure and sustain the future viability of the business.
“The voluntary administrators have not been appointed over any group companies with existing contracts with brokers or lenders,” the company said in a statement.
“Accordingly, the administration will not affect ongoing third-party stakeholder contractual obligations, such as trail payments by lenders to these companies and payments of trail by these companies to brokers.”
eChoice has confirmed earlier today that broker commissions, including trail payments made by lenders, will not be impacted by the appointment of voluntary administrators.
The eChoice aggregation business has experienced significant growth over the last financial year, with broker numbers up by 38 per cent over the 12 months to 30 June. Settlements also increased more than 25 per cent over the year to 30 September.
The Adviser understands that the administrators are seeking to sell off a number of underperforming entities within the eChoice Group, namely the aggregator’s lead generation and digital development arms. It is believed that the administrators are already aware of one major financial institution interested in the businesses.
“In the meantime, it is business as usual as far as possible,” the group said. “The focus of the business will be to ensure that employees, suppliers, lenders and brokers are able to deliver for customers as they always have.”
