Hirequip, New Zealand’s largest rental company, agreed to sell to a Japanese private equity firm for NZ $165 million (about U.S. $112 million). The sale is subject to shareholder approval, according to the Dunedin, N.Z.-based public-traded rental company.
Hirequip shareholders will meet Dec. 18. Hirequip directors are recommending the sale.
The private equity firm, PES Finance, is a subsidiary of Pacific Equipment Solutions, a company associated with Nikko Principal Investments.
The price could rise by as much as NZ $7.5 million if earnings in the year ended June 30, 2007 meet Hirequip’s budget. Hirequip chairman Graeme Wong said the company did not achieve budget in the first four months of its current fiscal year in regard to revenue and earnings before interest and tax, but that the board was confident that it could for the remainder of the year.
Hirequip officials said the company was selling to capitalize on current interest in equipment rental. Wong said the sale price is fair market, and was achieved after a competitive tender process conducted by First NZ Capital.
Hirequip has more than 50 branches.