Rangatira agrees to sell its 50% Stake in Contract Resources
December 27, 2012: Wellington investment company Rangatira today announced that it has entered into a conditional agreement to sell its 50% share of Contract Resources Holdings Limited (Contract Resources) to Hellaby Holdings Limited (Hellaby).
Rangatira’s involvement with Contract Resources dates from 2004 and since that time the company has substantially expanded both its operations and returns, becoming one of Rangatira’s two largest investments. Recently some shareholders expressed a wish to exit their shareholdings and, following a competitive sale process, Hellaby Holdings offered to acquire an 85% stake in the company.
Rangatira CEO Ian Frame commented, “While we have not been looking to sell, Contract Resources has grown to represent more than a third of our unlisted investment portfolio. With some of our initial partners selling and Hellaby’s offer for control at an attractive level, we have decided it is an appropriate time to realise the funds of just over $50 million for reinvestment into other growth opportunities.”
Subject to finance and other conditions being satisfied, the sale is expected to be concluded on 31 March 2013.
Rangatira Chairman Murray Gough said, “In its half year report Rangatira’s Directors indicated to shareholders that the Net Asset Value of its shares, including the mid-point of their assessment of the unlisted companies, was $9.26 at 30 September 2012 compared to $8.77 at 31 March. Assuming the CRL sale becomes unconditional, and taking account of the performance to date of Rangatira’s listed share portfolio and its unlisted investments, the Net Asset Value of Rangatira’s shares at 31 March 2013 is likely to exceed $10.00.”
About Contract Resources:
Founded in New Zealand, Contract Resources is an international specialised industrial services company, the operations of which are split into two key service areas:
- Providing specialised niche services to oil refineries, gas processing (LNG) and petrochemical plants through catalyst handling and specialised mechanical services (“Catalyst Handling and Mechanical Services”), and
- A broad range of environmental and industrial services including tank maintenance and environmental services, hydro-jetting and heat exchanger services, pipeline services, offshore exploration and production services, decontamination and chemical cleaning services, and industrial coatings (“Environmental and Industrial Services”).
The business operates internationally, providing services in Australia (its largest market), New Zealand, the USA, the Middle East, Asia and South America.
The Company has a blue chip client base that includes a large number of multi-national oil and gas companies, reflecting Contract Resources’ reputation in the oil and gas sector for providing its clients a superior technical service through highly qualified and trained staff, advanced technology and a strict adherence to quality and safety. The ability to offer an integrated range of specialised industrial services and a multi-skilled workforce sets Contract Resources apart from its competitors.
More information is available on the company’s website www.contractresources.com.
Rangatira is a Wellington-based investment company with assets of over $150 million. Established in 1937, the Company is 51% owned by the JR McKenzie Trust with other community and charitable organisations owning another 15% of the shares. Private investors own the balance of the shares, which are traded on the Unlisted exchange. Recent prices have been between $6.00 and $6.20.
Rangatira’s mission is to increase both the capital value of its shares and the dividends paid to its shareholders by investing creatively and competitively.
Rangatira has built a portfolio of local and international investments across a wide range of sectors. The Company has pursued a policy of investment in small to medium-sized unlisted New Zealand companies, complemented by holdings in a range of publicly listed New Zealand, Australian and international companies. All investments have been made taking a long-term position in companies that are well founded and well managed with good growth potential. Rangatira is strictly commercial in its investment approach and benchmarks its performance against the wider investment community.
Rangatira will continue to explore investment opportunities across a range of business sectors. We aim to add value to our unlisted investments by actively contributing at management and board level, recognising the need to combine high standards of governance with sound management and a clear focus on growth and profitability.
08:13PM Thursday, 03 January, 2013