Perth lights attract Kalgoorlie mutual

Goldfields Credit Union will have spent the equivalent of the last four years' profit in its quest to cast off its mutual status and list on the Australian Securities Exchange.

The Kalgoorlie-based mutual released the prospectus for its proposed demutualisation yesterday.

The document shows that by the time it has paid all the necessary fees to advisers and its ASX listing fees it will have invested A$1.8 million in the exercise, which is the aggregate of its profits from 2008 to 2011 combined.

The fees are also equal to more than 30 per cent of the capital base of one of the smallest deposit-taking entities in Australia.

To top up a capital base of less than $6 million, GCU is also seeking authority for the sale of $9 million in new shares. The sale of these new shares will dilute the holdings of shares held by existing members to less than 40 per cent of the company.

The business plan outlined in the prospectus proposes to create "a significant Western Australian financial institution" - one that will be built on assets of only A$60 million, equal to 0.002 per cent of all assets of the banking system (including credit unions and building societies) in Australia.

The plan calls for expansion into the Perth market, with a distribution agreement for deposit accounts with Patersons Securities (the sponsoring broker) being the cornerstone of this effort.

David Holden, a former chief financial officer of Home Building, is the CEO-designate.

The credit union is yet to announce a date for the special meeting of members to vote on the proposal.

Members will also be asked to endorse a change in name to Goldfields Money.