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Vector expands energy service suit with HRV, PowerSmart acquisitions

Wednesday 15th March 2017

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Vector has expanded out its suite of energy services with the acquisition of E-Co Products Group, better known as home ventilation firm HRV, and solar power firm PowerSmart, both for undisclosed sums. 

The Auckland-based electricity, gas and telecommunications lines company expects HRV and PowerSmart will add to earnings from the 2018 financial year, and will pay for the acquisitions using existing debt facilities, it said in a statement. Chief executive Simon Mackenzie said the businesses will operate independently and give Vector new channels to provide a broader array of services to customers. 

"The acquisition of both E-Co Products Group and PowerSmart will boost our ability to deliver these new solutions, at both a household and commercial scale," Mackenzie said. "These companies share our vision of a new energy future and we believe it's an excellent fit for all parties."

Last year, HRV said it was on the acquisition trail with a planned roll-up of small companies in the retrofit healthy homes sector, and that it was looking at an initial public offering as a potential exit for Australian private equity company Equity Partners, which bought into the firm in 2010 and has a 60 percent holding. HRV was set up in 2003.

Financial statements lodged with the Companies Office show HRV increased profit 42 percent to $3.7 million in the year ended March 31, 2016, on a 15 percent gain in revenue to $42.7 million. The company valued its total assets at $29.9 million at the balance date, and had bank debt of $10 million and related party loans of $2 million. After the balance date, it bought Energy Efficient Solutions and HVAC Hero. 

HRV chief executive Bruce Gordon today said Vector provided "key expertise and innovation in areas that will benefit our business and take it into a new era."

PowerSmart was controlled by founders Mike Bassett-Smith, Dean Parchomchuk, and Shane Robinson, who each owned about 28 percent of the firm. The remaining 15 percent was owned by a collection of Canadian investors. 

Bassett-Smith said Vector's scale would help PowerSmart's plans to expand, giving it scope to "undertake ever larger, more complex projects". 

As at Dec. 31, Vector said it had net debt of about $1.97 billion at a gearing ratio of 43.9 percent, down from $2.74 billion, or 53.4 percent, a year earlier. 


Vector shares last traded at $3.22 and have slipped 0.6 percent so far this year. 

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