Credit Clear appoints ARMA Group co-founder as new CEO

Credit Clear ASX CCR Andrew Smith CEO AMRA
ARMA co-founder Andrew Smith has taken up the chief executive officer role with Credit Clear.

Digital receivables management provider Credit Clear (ASX: CCR) has announced a new chief executive officer following the acquisition of debt recovery solutions company ARMA Group Holdings.

Credit Clear has appointed ARMA co-founder Andrew Smith to drive its continued business growth, primarily responsible for delivering digitisation services for existing and new clients.

Credit Clear’s former chief executive officer David Hentschke (who was appointed in July) will move over to the newly-created role of managing director (international and technology), responsible for the globalisation of Credit Clear’s activities in South Africa, the United Kingdom and the US.

Mr Hentschke will also oversee the development of Credit Clear’s proprietary digital billing and communications technology platform designed to help businesses achieve smarter, faster and more innovative financial outcomes by changing the way customers manage their payments.

Head of management

Credit Clear chairman Gerd Schenkel welcomed Mr Smith to the head of the management team.

“It gives me great pleasure to formally welcome ARMA to the Credit Clear group,” he said.

“Andrew and his team have shown great expertise and determination in building a fast growing and profitable Australian business [and now] under his leadership, we can deliver significant growth for Credit Clear in Australia.”

Credit Clear manages customer accounts across a range of industries including transport, financial services, insurance, government, and utilities.

The company is headquartered in Melbourne and has offices in Sydney, Brisbane, Adelaide and Perth.

ARMA acquisition

In December, Credit Clear agreed to acquire ARMA for $46 million, partially funded through a $25.5 million institutional placement and $4 million share purchase plan.

The placement was fully subscribed at $0.40 per share, while the share plan closes later this month.

The acquisition will leverage Credit Clear’s scalable billing platform across ARMA’s client base of more than 400 active customers across Australia and New Zealand.

It will also strengthen the financial and operational profile of the combined group as Credit Clear’s technology will significantly increase ARMA’s operating leverage.

Debt recovery

ARMA is a fast-growing and profitable provider of contingent debt recovery solutions, outsourced accounts receivables and litigation services.

The company reported $6.4 million normalised EBITDA (earnings before interest, taxation, depreciation and amortisation) in the 2020-21 financial year from $15.5 million revenue.

It kickstarted the first quarter of the new financial year with $2.6 million EBITDA from $4.8 million in revenue.

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