Ngai Tahu, Tainui team to buy bus firm
Two powerful Maori funds have agreed to buy Australian-owned New Zealand bus operator Go Bus for $170 million.
Ngai Tahu Holdings Corporation (NTHC) and Tainui Group Holdings (TGH) have conditionally bought Go Bus from Sydney-based private equity firm Next Capital.
NTHC is the majority investor with a two-thirds share and TGH has the remainder. The purchase is due for completion at the end of September.
Go Bus operates urban, school and charter bus services throughout New Zealand, with leading market positions in Hamilton, Napier, Tauranga and Christchurch.
Ngai Tahu Holdings chief executive Mike Sang said Go Bus was a well-run business.
"Go Bus will enable us to further grow and diversify our portfolio in a way that is complementary to the rest of our investments," he said.
Tainui Group chief executive Mike Pohio said Go Bus had a strong regional presence and was well placed to grow its footprint nationally.
"When it comes to size and scale of businesses, we look at where we can bring things to the table."
Pohio said TGH was looking to diversify its investment portfolio, and the joint deal "fits nicely" into an investment deal signed with Ngai Tahu in 2007.
Go Bus employed Waikato Tainui people and was an "environmentally friendly service", he said.
"We will target growth where it makes sense [with a focus on] more jobs, stronger returns and better service provision. There are aspects about this business that are local and it has a good local presence.
"We are here to support Go Bus management to make this an even better company then it is."
The agreement remains conditional until September 30, Pohio said.
Go Bus chief executive Calum Haslop said both iwi were a natural partner for the business.
NTHC and TGH were the underbidders on Transpacific's New Zealand waste management business that was sold in March to Beijing Capital Group for $950 million.
In June, Waikato Milking Systems, New Zealand's biggest manufacturer and designer of milking systems, with annual turnover of $100 million, was acquired by the two iwi and Pioneer Capital.
Westpac is financing the Maori funds' bid for Go Bus.
Go Bus was part of Next Capital's second fund which also held stakes in recent divestments including Discovery Parks and Aero-Care.
Next Capital, run by John White, Sandy Lockhart and Patrick Elliott, bought an 86.8 per cent shareholding in Go Bus in May 2012.