MIDDAY UPDATE: Hellaby spends $103M on Contract Resources

By Paul McBeth

Dec. 27 (BusinessDesk) - Hellaby Holdings plans to spend $103 million in a Boxing Day sale to buy engineering maintenance and industrial cleaning firm Contract Resources.

The Auckland-based investment firm will spend $73 million on an 85 percent stake in Contract Resources, and saddle it with $30 million in debt, it said in a statement today. The other 15 percent will be held in equal tranches by chief executive Andrew Wells and senior managers Trevor Penny and Gray Gardner. The deal puts an enterprise value of $116 million on Contract Resources.

Hellaby has been on the prowl for a new acquisition since 2010, when it got its debt under control faster than expected after the global financial crisis.

Contract Resources is expected to generate sales of $150 million in the year ending March 31, 2014, with earnings before interest, tax, depreciation and amortisation of more than $20 million. The business operates internationally, with Australia its biggest market, and counts Caltex, Shell, Exxon Mobil and NZ Refining Co among its customers.

Wellington investor Rangatira was one of the sellers, with a 50 percent share of Contract Resources, and stands to realise just over $50 million in cash from the exit.

Mike Pero Mortgages sale gets nastier

NZF Group's exit from Mike Pero Mortgages has taken a turn for the worse with partner and potential buyer Liberty Financial stalling a shareholder vote on the sale by filing papers in the High Court.

The Australian buyer has applied to "restrain information that NZF Group may provide to its shareholders in considering the sale and to compel the directors of NZF Group to make a positive recommendation to approve the sale," NZF said in a statement.

The Auckland-based firm needs shareholder approval to sign off on the sale of its 50 percent stake in MPMH, which was valued at $2.76 million by Simmons Corporate Finance, as it's more than eight times greater than NZF's $330,000 market capitalisation. NZF shares last traded at three-tenths of a cent, and have plunged 90 percent this year.

Last month, NZF said it valued the stake at $7.51 million and that its board was surprised by the discrepancy between the valuations.

A High Court hearing is scheduled for February.

NZ shares creep higher after Christmas break

New Zealand edged higher in quiet morning trading after the Christmas and Boxing Day holidays.

The NZX 50 index rose 0.1 percent to 4063.77 as at midday, led by carpet-maker Cavalier Corp and rural supplies firm PGG Wrightson. Cavalier gained 3.1 percent to $1.67 and Wrightson was up 2.4 percent to 43 cents.

Retailer Hallenstein Glasson was the biggest decliner, falling 1.8 percent to $5.40, followed by NZ Oil & Gas, down 1.7 percent to 85 cents.



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