Mercer Group pays $1m for slice of Titan businesses
BUSINESSDESK: Mercer Group, the stainless steel fabricator, has paid $1 million for a controlling stake in Titan Slicer, which designs and makes equipment to slice meats and cheese.
The Auckland-based company will hold a 75% stake in Titan Slicer and 25% of Titan Design, it said. Sean Marr, one of Titan’s owners, will continue to run the businesses.
"Mercer expects this deal will be earnings positive from day one and is currently working on new Mercer budgets for FY13," chief executive Rodger Shepherd said.
Mercer paid the $1 million from existing cashflows and Bank of New Zealand facilities. It will also provide further working capital to assist growth.
The company will provide earnings guidance for 2013 in August when it announces its results.
Mercer stock plunged in 2008, and was further punished when it halted repayments to South Canterbury Finance, when the late Allan Hubbard was a cornerstone shareholder, after breaching its banking covenant.
In August, Shepherd, former deputy chief of Fairfax New Zealand, took over the role of chief executive undertaking a strategic review of the business.
He has since been tasked with turning the previously unprofitable company around.
Its shares last traded at 12 cents and have gained 103% this year.