In filings to the Securities Exchange Commission, the board of directors at has now officially declared its intention to privatize the company’s Canadian operations at the same time confirming it is seeking a potential merger or acquisition.

“As noted in the past three Form10Q reports for 2011, management has been actively exploring restructuring options to reduce overhead expenses,” reads the April 12 annual report for Holdings. “The Company Board of Directors … has decided to privatize our Canadian operations and amalgamate them with a private company under common control. The Company is actively seeking candidate companies to for a reverse merger transaction or strategic acquisition. At the present time, the Company is in discussion with two candidate groups to complete the contemplated transaction.”

There is no timetable for completing this process, according to the 10-K filing, although management is aiming to complete restructuring by June 30, 2012.

Four key factors played into the decision to move toward privatization, according to the summary statement:

1. the current economic conditions and the ongoing loss of cash from operating activities;

2. the high costs associated with driving a high-service value proposition in an eroding margin brokerage marketplace in Canada;

3. current equity market conditions not being favourable for a publicly traded mortgage brokerage operation limiting the liquidity of our stock and company capitalization; and,

4. the increasingly high costs associated with administering a publicly traded company.

Gross revenue for Holdings decreased in 2011 by 6 per cent from 2010 to $13,498,395.

“As discussed in more detail in Item 1 within this Form 10-K, our sales management team experienced a decrease in the number of our mortgage agents by 26 per cent in 2011 as compared to 2010,” continues the filing statement, “which would have had a direct negative impact to top-line revenue numbers.

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