BUSINESSDESK: Equipment rental company Hirepool has sought clearance by the anti-trust regulator to buy rival Hirequip out of receivership in a bid to get greater exposure to the heavy construction sector as the Christchurch rebuild starts hitting its stride.
Hirepool, which is 75% owned by Australian private equity firm Next Capital, has requested the Commerce Commission clear its acquisition, saying the merger will not substantially cut competition as they largely operate in different areas.
A sale and purchase price agreement has yet to be negotiated, though Hirepool's takeover would have to satisfy Hirequip's secured creditor Westpac Banking Corp, which is owed $117.8 million. Hirequip's unsecured creditors are also owed $76.9 million, according to the first receiver's report.
The company indicated it was willing to go beyond merely paying the purchase price, according to the public version of its application, which had sections blacked out.
Hirepool says the deal would give it a "meaningful presence in the high value heavy and building segments", an area it is not really exposed to. Its existing customers are largely small and medium construction businesses which it targets with specialist equipment, it says.
The company pointed to the Christchurch earthquakes as a "catalyst for growth" and led to new entrants into the market and expansion by existing players.
Hirequip's parent shareholding companies Pacific Equipment Solutions, PES Finance and Hire Equipment Group are the entities placed in receivership in July, and came just a month after boss Rob Nichols was quoted as saying the company could seek a listing on the NZX as earnings recovered.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- Minimum wage to rise
- Trump signs three executive orders, including withdrawal from TPP
- Why did Megaupload 2 launch turn to custard on Jan 20? Dotcom offers explanation
- Traditional renting model shows poor returns compared to Airbnb
- Can the US’s constitutional and legal set-up keep Donald Trump in check?
Most listened to
- BusinessNZ chief executive Kirk Hope comments on the increase to the minimum wage
- Megan Alexander on Robert Half's gender pay gap research
- HSBC's Paul Bloxham on what's contributing to New Zealand's economic growth
- NZ Initiative's Eric Crampton looks at ways Auckland's severe housing unaffordability can be fixed
- CMC Market's trader Sheldon Slabbert is expecting the kiwi dollar to follow inflation higher
- Steven Jacobi on US TPP withdrawal - "ultimately, this will be defeating for the American worker"