Aussie company bids for Hellaby Holdings

hannahs, hellabyASX-listed autoparts firm Bapcor, has made a $NZ322.5 million ($A307.1m) takeover bid for NZX-listed Hellaby Holdings as it looks to extend its reach into New Zealand’s local auto market.

Bapcor has given notice of its intention to make a takeover offer for 100 per cent of the fully paid shares in Hellaby for a cash consideration of NZ$3.30 per share. Bapcor has secured lock-up agreements in respect of approximately 30 per cent of Hellaby’s issued shares.

“The proposed acquisition of Hellaby, if successful, will enable Bapcor to enter the New Zealand automotive parts market and use its scale and proven industry expertise to improve the service and range of products offered in New Zealand, while looking for opportunities to expand, as it successfully has in Australia,” said Darryl Abotomey, CEO of Bapcor.

Bapcor is a provider of automotive aftermarket parts, accessories, automotive equipment, and motor vehicle servicing, with a network of over 750 locations across Australia, including well-recognised retail store and workshop service brands Burson Auto Parts, Autobarn, Autopro, Opposite Lock, Midas and ABS.

Hellaby recently unveiled plans to restructure its footwear division.

“If our offer is accepted we will offer Hellaby customers a greater customer experience through new product ranges, technology and proprietary customer loyalty programmes, and Hellaby and Bapcor employees will receive enhanced career opportunities. The new entity will become the clear Australasian leader in the automotive aftermarket.”

“The fact that interests representing approximately 30 per cent of Hellaby’s shares have already agreed to accept the Offer speaks for itself – particularly as these interests have been long term holders of the stock who understand the business well,” said Abotomey.

Bapcor has a strong history of growth, both organically and via acquisition. Since listing in 2014, it has significantly expanded the scope of its operations, with the A$275 million acquisition of Metcash Automotive in July 2015 a key pillar to this expansion.

The Metcash acquisition has been further complemented by other acquisitions, and continued organic growth in the traditional trade business. As a result, Bapcor has transformed from an ~A$300 million market cap company at listing to an ~A$1.5 billion market cap company today.

The transaction is expected to be fully funded through a combination of current cash holdings, debt facilities, and an A$185 million equity raise. The equity raise will comprise an A$165 million fully underwritten institutional placement, accompanied by a non-underwritten Shareholder Purchase Plan (‘SPP’) to raise approximately A$20 million.

Bapcor is being advised by Morgan Stanley, First NZ Capital Limited, Bell Gully and Allens in respect of the proposed takeover.

The Hellaby Board said it is not in a position to comment further at this stage and will meet shortly to consider the takeover notice and draft offer in detail.

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