Malaysians take stake in bus joint venture
Failed Canterbury bus maker DesignLine International Holdings (NZ) has been sold to a joint venture in which Malaysian interests have a controlling stake.
One of the receivers, Keiran Horne of HFK, said a joint venture of Malaysian, United States and New Zealand parties had bought the company, but the purchase price was not being disclosed.
The price would be revealed in the receivers' second report, she said.
However, it seems likely to be less than the $3.8 million owed to the Bank of New Zealand, the first ranking secured creditor.
Horne said the BNZ was likely to get most of its money back but that would depend on what residual stock – still to be sold – was worth.
Horne said DesignLine NZ had been sold as a going concern and most staff had been retained.
DesignLine was once New Zealand's largest bus manufacturer, with vehicles operating domestically and internationally.
The Malaysian interests are those mentioned in late May in a liquidation application in the High Court.
The counsel for DesignLine had said Malaysian interests were interested in buying the Rolleston manufacturing operation.
Horne said the joint venture would take some stock.
She expected to sell residual stock over the next few months.
She also expected the Glosson family, of North Carolina, who led the previous American shareholders, to have a stake in the joint venture through providing the intellectual technology.
The Glossons led a group of investors in late 2006 who bought DesignLine from its New Zealand founder, Ashburton entrepreneur John Turton. They set up a large factory in Charlotte, North Carolina, to build hybrid and electric buses using the intellectual property developed by Turton, as well as having the Rolleston site.
The American shareholders continued to own and run the Charlotte manufacturing operation.
The Rolleston operation had been renamed DesignLine Pacific Bus, sales and marketing general manager Barry Jones said.
Jones said he understood the Malaysian interests had between 51 per cent and 60 per cent of DesignLine Pacific Bus and the rest was owned by a group of 70 shareholders who had been "dragged together" by Jack Schroeder from DesignLine's former parent, DesignLine Corporation in North Carolina.
The Malaysian interests were headed by CC Lim, who owned coach and bus manufacturing businesses in Malaysia, as well as such businesses as a steel factory.
Jones said Lim's full name was Lim Thai Thant – a successful businessman who had built a light-rail system in Malaysia's capital, Kuala Lumpur.
Jones said 61 staff, most on the factory floor, had been retained from about 70.
At its peak DesignLine had about 160 Rolleston staff and 47 managerial employees. Now, only seven managerial positions remained.
Jones said Lim would be DesignLine chairman with two votes; his son, Kim Lim, would be a director with one vote and Christchurch accountant Murray Allott, who was temporarily running the financial side of the company, would have a seat on the board and a vote.
Jones said DesignLine had orders for about 130 buses worth about $24m, but the contracts would have to be renewed in the company's new name.
Lim was interested in the Rolleston factory exporting aluminium bus bodies to Malaysia so he could tap into the Malaysian Government contracts, Jones said.
- © Fairfax NZ News