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MELBOURNE - Private equity player Next Capital, which was founded by three former Macquarie bankers, has acquired hire companies On Site Australia and On Site Industrial Rentals.
The transaction values the newly created On Site Australia group at A$109 million ($122 million) on an enterprise basis.
Next Capital has a 60 per cent stake in the businesses, with the balance held by the vendors and senior management.
It is the firm's second foray into the hire industry after its $155 million acquisition of New Zealand-based Hirepool in July 2006.
Founder John White said Next Capital expected to capitalise on significant synergies between the Australian and New Zealand hire firms.
Yesterday's announcement brings to six the number of buys by the firm that was started almost two years ago by Sandy Lockhart, Patrick Elliott and White.
The trio previously ran Macquarie Bank's private equity division, Macquarie Direct Investment, where they resurrected firms such as JB Hi-Fi, Invocare and The Reject Shop.
Next Capital has forged its own path since it was launched in October 2005 with an initial fund of A$265 million from institutional investors.
With 65 per cent of the original fund now spent, the six acquisitions in the past 12 months have a total enterprise value of A$563 million.
They include a 73.6 per cent stake in RPG Australia, which supplies steel towers for wind farms, and a 55.6 per cent interest in Brisbane-based steel manufacturer and distributor SteelForce Australia.
White said the growing trend towards hiring rather than buying equipment in the heavy construction and mining industries augured well for the new acquisitions' growth prospects.
Last December, Next Capital shelled out A$21 million for an 88.2 per cent stake in health food and supplement manufacturer Healtheries.
In February this year it invested $17 million to acquire a similar New Zealand health supplements and sport nutrition company, Nutra-Life Health & Fitness.
- AAP
