Hirequip unfazed by lost acquisition

By Duncan Bridgeman

Friday 13th February 2004

Hirequip executive chairman Graeme Wong yesterday shrugged off a rival operator's purchase of Takanini-based Hire King, saying the southern-based company had other fish to fry.

Fellow rental company Hirepool this week bought Hire King for an undisclosed sum, apparently out-bidding Hirequip at the last minute.

Mr Wong said he was unconcerned by the move, despite Hirequip's earlier interest in the South Auckland company.

"At the right price we would have bought it but if someone else wants to come over and bid higher then that's their prerogative."

Mr Wong said Hirequip was re-setting its sights having achieved its objectives since its transition from investment company Southern Capital eight months ago.

In December, Hirequip bought central North Island company Ready Hire for $21.2 million. That acquisition increased the company's hire revenue 30%, Mr Wong said.

The company had also recently bought another branch in Christchurch.

"We are looking at a range of different options but we just need to re-set our sights after settling down [the Ready Hire business]."

Hire King's purchase was part of a further rationalisation of the rental sector.

Hirepool Managing director Tenby Powell was last year part of a consortium that bought Hirepool from Owens Group for $46.6 million.

JB Were took a 51% stake through its Private Equity No.1 Fund, with Mr Powell through Hunter Powell Investments and Owens Group each taking 24.5%.

Mr Powell said the Hire King acquisition gave Hirepool a strategic foothold in what was previously a gap in the market for the company.

"Having a presence in this expanding area will strengthen our ability to service both trade and DIY customers," he said.

Hirequip's Mr Wong said he was unconcerned by the rival company's expansion.

"We've got our own strategy."

Hirequip was this year planning to increase its branch network from 37 to 39 as it focused on making hire equipment its core business.

Last year the company invested $15.9 million in plant and equipment. Mr Wong said the company expected to spend another $14 million this financial year.

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