Hirepool plans to raise up to $262M in IPO, list on NZX, ASX July 11
By Tina Morrison
June 16 (BusinessDesk) - Hirepool, New Zealand's largest general equipment hire company, plans to raise as much as $262
million in an initial public offering and list on the Australian and New Zealand stock exchanges next month with a
market capitalisation of as much as $340 million.
The Auckland-based company said it plans to sell as much as 120.1 million new shares and 83.5 million existing shares at
between $1.10 to $1.50 apiece. The final price will be set by a bookbuild to institutions and retail brokers on June 24,
the company said.
Australian private equity firm Next Capital and its co-investors will raise as much as $125.2 million from selling their
shares and will continue to own between 20 percent to 35 percent of the company. Hirepool bought rival Hirequip out of
receivership in May last year and says the larger company with 58 branches expects to benefit from an expanding New
Zealand economy with a large pipeline of infrastructure and construction projects ahead, as well as eyeing acquisitions
and widening its product range.
"The merger of Hirepool and Hirequip last year has created a more efficient business with a better platform to invest in
higher yielding product offerings, complementary acquisitions and achieve more efficient fleet management," said
Hirepool chairman Emmet Hobbs.
The company expects earnings before interest and tax to rise 16 percent to $24.9 million in the current financial year
in the 12 months to June 30, and increase to $40.7 million next year, according to its prospectus.
Auckland businessman Tenby Powell, who founded Hunter Powell Investments with his partner Sharon Hunter, bought Hirepool
with Goldman Sachs JB Were from Owens Group for $43 million in 2003 and retained a 20 percent stake in the expanded
company when it was sold to Next Capital in 2006 for $174 million, according to his profile on the ICMI Speakers Bureau.
Shareholders of Next Capital and Macquarie expect to raise $43.2 million to $125.2 million from selling their shares
while a further $132.1 million to $136.5 million will be raised from the sale of new shares, according to the offer
documents.
Funds raised from the share sale will be used to raise capital, repay debt and provide an opportunity for existing
shareholders to realise all or part of their investment, according to the offer. The funds will also be used to pay for
the remaining shares in subsidiary Bligh Finance.
Net debt is expect to total $85.2 million at July 11 when the company plans to list its stock.
(BusinessDesk)