Lighter, sharper, faster: New look IAM delivers giant Earlypay capital transaction

Special Report: The asset manager has completed a major $30 million debt capital raise for Aussie fintech EPY, illustrating the agility of IAM’s new three-pronged business model.

Fixed income specialist and funds management firm Income Asset Management Group Ltd. (ASX:IAM) has announced the successful completion of a $30m debt capital raise for Earlypay (ASX:EPY).

The transaction was delivered in three tranches: $22.5m Class-A notes, $3.75m Class-B notes, and $3.75m Class-C note (being retained by Earlypay).

The company said institutions and wholesale SMSF investors participated in the secured raising despite the outright volatility riling global equity markets.

Earlypay is an Australian non-bank finance company which provides secured finance to SMEs in the form of invoice and equipment finance.

Solid positioning

The announcement continues the material uplift of placement fee revenue for IAM this year.

In March, IAM Capital Markets completed its largest new issue transaction as exclusive lead manager and continues the strong flow of placement fee revenue since the Capital Markets business was established in early 2021.

The Group’s first half revenue doubled year-on-year, buoyed by consistent capital market placement fees and bond trading income.

If that sounds good, excluding a prior year R&D grant, IAM’s underlying revenue growth was fascinatingly strong – jumping 287%.

The revenue increase now marks five straight quarters of growth for IAM.

Along with strong top-line growth, the executive team moved ahead with a business transformation that positions IAM with three complementary divisions providing sophisticated advice across the fixed income space.

The streamlining restructure flowed through to a 100% lift in group revenues from the prior year period, to $3.9m.
Co-Head of IAM Capital Markets James Shillington said that the Earlypay name was well received by investors.

“The investors were comforted by the fact that the security over the Earlypay pool of receivable assets has zero arrears and defaults and that the business is growing strongly,” Shillington said.

“The transaction follows the Floating Rate Notes issued through IAM in November 2021 and tapped in March 2022 highlighting our ongoing working relationship with Earlypay’s capital requirements.”

This article was developed in collaboration with Income Asset Management Group, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.