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Foreign investment in Aotearoa/New Zealand
Overseas Investment Office - June 2010 Decisions
US company buys Electropar
A very quiet month at the OIO (Is this the calm before the storm?) Firstly, Preformed Line Products Company United States Public (99%) and various overseas persons (1%) received approval for the acquisition of rights or interests in 100.0% of the shares of Electropar Limited which owns or controls a leasehold interest in 0.6 hectares of land at 35 Lady Ruby Drive, East Tamaki, Auckland. The vendors were existing Shareholders of Electropar Limited New Zealand Public (100%), the consideration was stated as "$20,500,000 less debt (the amount of which is to be finalised on the completion date) and subject to a working capital adjustment and an earn-out adjustment."
The OIO further states: "The Applicant is an international designer and manufacturer of products and systems employed in the construction and maintenance of overhead and underground networks for the energy, telecommunication, cable operator, information and other similar industries.
Electropar Limited is a designer and manufacturer of a range of equipment for the electricity distribution and transmission industry, the oil and gas industry, and the naval ship building defence industry. The acquisition is consistent with the Applicant's strategy to expand its global business in New Zealand.".
The Commerce Commission in approving this deal issued the following press release:
"The Commerce Commission has granted clearance for Preformed Line Products Company to acquire Electropar Limited.
The Commission considered the impact of the acquisition on the national market for the supply of conductor and insulator fittings. Commerce Commission Chair Dr Mark Berry said the Commission was satisfied that the proposed acquisition will not have, or would not be likely to have, the effect of substantially lessening competition in the affected market.
The Commission considers the merged entity is likely to be constrained by a combination of existing competition from Dulhunty, the ease of expansion from other existing competitors (local distributors) that could source products from very large overseas manufacturers, and the countervailing power of Transpower and distribution network companies."
Preformed Line Products is a US-based multinational company with subsidiaries in 13 countries. It manufactures products and systems employed in the construction and maintenance of overhead and underground networks for energy, communications and broadband network companies.
Electropar is a privately owned New Zealand based company operating in New Zealand and Australia. It manufactures and distributes electrical engineering components for use in the electricity transmission and distribution, defence and industrial sectors.
Both companies are involved in the manufacture and wholesale supply of transmission and distribution equipment used in electricity transmission and distribution networks, in particular insulators and fittings."
Back to TopAnd Motion Industries is purchased by the Aussies
Inenco NZ Limited Martin-Weber Family, Australia (100%) received approval for the acquisition of rights or interests in 100% of the shares of Motion Industries Limited which owns or controls a leasehold interest in 1 hectare of land at 88 Hastie Avenue, Mangere Bridge, Auckland. The vendors were existing shareholders of Motion Industries Limited New Zealand Public, New Zealand (100%); the consideration was $3,789,604.
The OIO states: "The Applicant is wholly-owned by Inenco Pty Limited a privately owned company incorporated in Australia whose core business is the distribution of bearings and power transmission products in Australia and New Zealand.
Motion Industries Limited is a supplier of ball and roller bearings, power transmission and associated products trading under the name SaecoPrecision.
The proposed acquisition is a good strategic fit with the Applicant's existing business activities in Australia and New Zealand. The acquisition will provide the basis for a wider product range and allow for economies of scale".
New Zealand's Precision Bearings & Transmission and Saeco Bearings & Transmission (Saeco ADI Limited) were acquired by Motion Industries Limited via a management buyout in 2001. The purchase price was NZ$ 19.4 million so the vendors appear to be taking a substantial loss on this deal.
Both Precision and Saeco operate numerous locations throughout New Zealand. Saeco is New Zealand's largest supplier of bearings and transmission products. In total, the two divisions of Motion Industries Limited operate 27 locations in New Zealand.
Back to TopOther June Decisions
John Douglas Tremlett and Pauline Diane Tremlett United Kingdom (except Isle of Man and the Channel Islands) (100%) received approval to acquire a freehold interest in 108.1 hectares of land at Bidwills Cutting Rd, Greytown, Wairarapa. The vendor was Antony Sidney Phelps and Richard Dale Paterson as trustees of the Phelps Family Trust Jill Vera Phelps, New Zealand (50%) and Antony Sidney Phelps, New Zealand (50%); consideration was $2,587,500.
The OIO states; "The land is a farm used by Mr Phelps, beneficiary of the Phelps Family Trust, principally for livestock grazing and seed cropping. Just over ten hectares are used for a commercial pumpkin growing operation.
Mr Tremlett has a background in vegetable growing in England and has served as a mentor to Mr Phelps. Because of the ongoing relationship between the Applicants and Mr Phelps, it has been agreed that the Applicants acquire the land and that Mr Phelps lease back the land. The principal reason for Mr Phelps selling the land is to provide additional capital for his horticultural business. He owns other farm land in the vicinity of the land. The Applicants are interested in expanding their investment interests outside the United Kingdom. They believe that New Zealand agriculture offers many opportunities, in particular in relation to the markets in the Pacific rim and Asian regions."
James Lloyd Glucksman and James Preston Boussy United States of America (100%) received approval to acquire a freehold interest in 0.5 hectares of land at 41 Towey Street, Oamaru. The vendor was Roy Kenneth Vannini and Bernice Vannini New Zealand (100%); consideration was $1,201,500. The OIO states; "The property to be acquired is a boutique hotel and home stay known as Pen-y-bryn Lodge, which the Applicants propose continuing to operate as a business, and will also use as their home. The Applicants intend to reside in New Zealand indefinitely, and presently hold Long Term Business Visas."
A summary of the parties involved in this deal was reported by Sally Rae in the Otago Daily Times on 3/7/2010:
"From living in what is believed to be the largest all-timber single-storeyed house in New Zealand to residing in a motorhome - that will be quite a transition for Roy and Bernice Vannini.
Mr and Mrs Vannini have sold their Oamaru mansion Pen-y-bryn Lodge, where they have provided luxury accommodation for the past 13 years, to Americans James Glucksman and James Boussy. They are looking forward to spending the next few years travelling, initially in the United Kingdom and Europe, before exploring New Zealand in their motorhome.
They fell in love with Pen-y-bryn when they came south from Auckland to view the property and bought it that same day. "We called it Roy's mid-life crisis. I'm having mine now," Mrs Vannini said, laughing. They were only the fourth family to own the landmark Towey St home, which has had a category one Historic Places Trust classification, since 1889.
It had been a "wonderful" place to live in and it had been a privilege to live there, Mrs Vannini said.
Among their guests, the couple have hosted many famous and titled people, whose names they would not divulge, and it had been a lot of fun, along with a lot of hard work. They had met people from all over the world.
In 2001, Mr and Mrs Vannini won the premier award in the inaugural Whitestone Waitaki Tourism Awards and the lodge has been named in National Business Review's top 100 houses in the country.
The couple have both been involved with tourism, both locally and nationally, and Mr Vannini has served as chairman of the New Zealand Lodge Association, which represents luxury lodges and sporting retreats.
Finding the right people to take over the property was a painstaking process but, when they met "the Jameses" early this year, they knew they had found the perfect purchasers.
Mr Glucksman is a health economist and investment strategist and also an accomplished amateur chef, food critic and writer. Mr Boussy is a dentist and also a gardener, home improvement specialist and baker.
The pair looked forward to running Pen-y-bryn to the same high standard, while expanding its culinary offerings. The pair will leave their current home in Beijing and arrive in Oamaru in early August."
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