Thursday 16th February 2012
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Tenon, the NZX-listed company that sells wood mouldings in the US, has bought Australian manufacturing assets in a bid to expand its business outside North America.
The company, which is controlled by NZX-listed Rubicon, has bought some of Victoria-based Whiteline Timber Products manufacturing assets as a first step into the Australian market. Using Whiteline’s reseller chains and independent stores, Tenon will sell mouldings, high grade boards and architraves.
“We are pleased to be entering Australia in what is the number two incumbent position in hardwood mouldings and profile products,” chief operating office Tony Johnston said in a statement. “With our global supply chains and our large Taupo manufacturing site close to the market, we will be able to bring considerable additional value to our Australian customers.”
The move into Australia is part of the company’s strategy to grow value by establishing new businesses outside its North American market.
In December, Tenon chairman Luke Moriarty complained the company’s earnings are “held hostage” to poor conditions in the US housing market and has previously flagged New Zealand, China and Japan as other potential markets for the company to access.
The Australian venture will source and manufacture some hardwood products locally, but will also use its existing supply, including its Taupo manufacturing site in New Zealand.
Earlier this month, Tenon signed a deal to distribute a long-life wooden decking product made by Eastman Chemicals into US-based home improvement chain Lowe’s.
The shares rose 2.7 percent to 75 cents.
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