Allied Farmers has entered into an agreement to buy Speirs Group's finance division for $5.6 million.
Speirs Finance provides loans for commercial vehicles and capital equipment for New Zealand businesses, and will be amalgamated into Allied Nationwide Finance.
Allied Farmers says the acquisition the acquistion will increase the size and scale of its existing finance company, Allied Nationwide Finance.
It says Speirs' lending falls within the areas Allied Nationwide already lends to.
In the year to March, Speirs had total loan receivables of about $230 million, funded through the issue of secured stock and bonds to retail investors, as well as commercial paper.
Once amalgamated with Allied Nationwide Finance, the combined company will have about $400 million in assets and a loan book covering the commercial, rural and property finance sectors.
The transaction still requires the approval of Speirs Group's shareholders, as well as the approval of Standard & Poors.
The sale price will be paid through the issue of $2.5 million in new shares in Allied Farmers, and $3 million in cash.
