Bank of Queensland Limited · ASX:BOQ
Bank of Queensland — Merger or Acquisition (August 2003)
24 slides from Bank of Queensland's merger presentation, Aug 15, 2003
Slide 1: Presentation to investors
Presentation to investors Acquisition of UFJ Australia Finance Limited and capital raising 15 August 2003
Slide 2: Important notice
Important notice • This presentation is supplied to you in confidence for the purposes of enabling you to evaluate the Offer and determine whether or not you wish to apply for a firm allocation of Ordinary Shares. This presentation must not be reproduced or distributed in any manner outside of your
Slide 3: Presentation team
Presentation team David Liddy Managing Director - Bank of Queensland Robert Hines Chief Financial Officer - Bank of Queensland Patrick Broughton Executive Director - ABN AMRO Rothschild 3
Slide 4: Outline
Outline 4 Highlights 4 Overview of the acquisition 4 Offer summary and timetable 4 Pro-forma balance sheet 4 Bank of Queensland 4
Slide 5: Highlights
Highlights 4 Bank of Queensland (“the Bank”) is to acquire UFJ Finance Australia Limited, an equipment financier with a $964m receivables portfolio (as at 31 December 2002) for a premium of $7m over the estimated net book value at acquisition 4 Acquisition financed by a $117m equity and Reset Prefer
Slide 6: 1. Overview of the acquisition
1. Overview of the acquisition
Slide 7: Acquisition consistent with our stated goal
Acquisition consistent with our stated goal 4 The Bank is to expand its capabilities, diversify its portfolio in the equipment finance and lease market through a strategic acquisition of UFJ Finance Australia Limited (“UFFA”) from UFJ Australia Limited 4 Acquisition is consistent with our stated goa
Slide 8: The UFFA business
The UFFA business 4 An equipment financier providing traditional equipment finance and vendor finance to Australian industry through an established national sales network – An active equipment financier to Australian businesses for 32 years Key Business Metrics 1 Key Financial Metrics $m 4 No. of ma
Slide 9: The UFFA business … continued
The UFFA business … continued 4 A large and highly diversified portfolio of lease assets – Diversified geographically and across industry sectors – Top ten customers represent less than 7%, and no client more than 1%, of total exposure 4 Transport, computer and agricultural equipment accounts for th
Slide 10: Acquisition rationale
Acquisition rationale The acquisition represents a strong strategic fit Increased capacity in 4 Provides greater scale in the SME equipment finance market, increasing total equipment finance assets under management from approximately equipment finance $200m to over $1.1 billion – Brings economies of
Slide 11: Acquisition rationale … continued
Acquisition rationale … continued Increased revenue 4 Provides access to a national sales force and approximately 15,000 opportunities customers – Opportunity to generate additional revenues by offering the full range of the Bank’s products to these customers and distribution channels 4 The Bank wil
Slide 12: Acquisition rationale … continued
Acquisition rationale … continued 4 When combining the results of the Bank for the 12 month period to 28 EPS accretive February 2003 with those of UFFA for the 12 month period to 31 December 2002, the acquisition is EPS accretive 4 The Bank intends to securitise a sizeable proportion of both the acq
Slide 13: How the acquisition is to be funded
How the acquisition is to be funded Source and Use of Funds Use of Funds Payments to vendor $13.1m Refinance existing debt and other $707.8m Total cost $720.9m Source of Funds Placement $30.0m Rights issue $62.4m RPS issue $25.0m Total Equity & RPS $117.4m Subordinated debt $30.0m Bridge Loan $573.5
Slide 14: Acquisition due diligence
Acquisition due diligence 4 The Bank and its advisers have conducted due diligence on the UFFA business, which included a review of: – The lease portfolio – The UFFA credit assessment and acceptance process and policies – Large portfolio exposures – Accounting and tax due diligence – Legal due dilig
Slide 15: 2. Offer summary and timetable
2. Offer summary and timetable
Slide 16: Offer summary
Offer summary 4 The Bank intends to issue up to $92m of ordinary equity through: – Underwritten $30m private placement of ordinary equity to institutional investors • Shares issued in the placement will rank equally with all other shares for any final dividend that may be declared for the full year
Slide 17: Offer timetable
Offer timetable Timetable Acquisition announced to ASX 15-Aug Trading halt 15-Aug Conference call for investors and analysts (ABN AMRO Rothschild offices) 15-Aug Bookbuild 15-Aug Share price set for placement – Allocations notified 15-Aug Investors to return signed allocation acceptance letters 15-A
Slide 18: 3. Pro-forma balance sheet
3. Pro-forma balance sheet
Slide 19: Pro-forma balance sheet
Pro-forma balance sheet Pro-forma consolidated balance sheet is based on the most recently reviewed balance sheet of the Bank (at 28 February 2003) and the most recently audited balance sheet of UFFA (as at 31 December 2002) The Bank UFFA At 28 February At 31 December Pro Forma 2003 (Reviewed) 2002
Slide 20: 4. Bank of Queensland
4. Bank of Queensland
Slide 21: Bank of Queensland … overview
Bank of Queensland … overview 4 Strong market share in the Queensland market underpinned by an extensive branch network. 4 Strong growth in a quality asset base, which has doubled in the past 4 years, to $7.3 billion in assets under management (as at 28 February 2003) 4 Loan assets dominated by low
Slide 22: Recent financial highlights
Recent financial highlights Achieving sustainable growth in earnings on a high quality asset base Assets growing strongly … … solid capital position … ... declining Cost to Income ratio 8 16%12.0% 80% 14% 7 Income & expense growth 12% 3.8% 4.1% 3.5% Cost to Income ratio 9.0% 2.9% 76% 6 10% 8% 72% 5
Slide 23: Recent share price performance
Recent share price performance The Bank has outperformed the S&P/ASX200 by 24% and the Financials (ex- Property) index by 30% in the past year BOQ share price performance (last 12 months) $9.00 1 week VWAP $8.73 $8.50 2 week VWAP $8.60 1 month VWAP $8.54 $8.00 $7.50 $7.00 $6.50 $6.00 $5.50 Aug-02 Oc
Slide 24: Bank of Queensland … dimensions
Bank of Queensland … dimensions 4Figures correct as at 14 August 2003, unless otherwise stated 4 Market capitalisation $644m 4 Shareholders c.26,500 4 S&P Credit Rating BBB/Stable 4 Assets under management (at 28 February 2003) $7.3 billion 4 Number of employees (at 28 February 2003) 670 4 Branches
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