New York link in bid for control of Tourism Holdings

Ballylinch LP already owns just over 19 per cent of the ordinary shares in the New Zealand company. File photo / NZH

A New York private equity company is linked to a firm bidding for a controlling stake in Tourism Holdings, the listed firm that owns the Maui and Britz campervan brands.

Ballylinch LP already owns just over 19 per cent of the ordinary shares in the New Zealand company, after acquiring them from a number of parties including Sterling Grace Capital Management on Thursday.

It is aiming to acquire 40.85 per cent of the shares it does not already own in Tourism Holdings, at 67.5c a share.

If successful, the bid will give Ballylinch a controlling stake in the New Zealand firm.

The offer, which is conditional on Ballylinch obtaining more than 50 per cent voting rights in Tourism Holdings, was made at a 12.5 per cent premium to the Thursday closing price of the stock. However, Tourism Holdings shares surged 16 per cent on the news of the takeover bid, closing at 70c last night.

According to a Bloomberg company overview, 53-year-old John Grace - director of Ballylinch LP's general partner Ballylinch General - is the founder and chairman of the New York-based investment firm Sterling Grace Corporation.

"The firm [Sterling Grace] seeks to invest in undervalued situations in the United States, Australia and Europe as well as in emerging markets ... it seeks to take an executive role," the overview said.

Ballylinch General is registered in New Zealand, with Grace listed on the Companies Office website as its sole director with an address in the Swiss mountain village of Clarens.

In a statement supplied to the NZX yesterday, Grace said the offer would provide Ballylinch with the ability to invest further in Tourism Holdings.

"I have been a supporter of THL for many years and in these difficult times believe that a company as important as THL in an industry that is as important to New Zealand should have a stable cornerstone shareholder," he said.

Grace expected the offer to be well supported by shareholders.

Tourism Holdings chief executive Grant Webster said last night that he did not want to discuss the matter, as the firm's board had not yet met to discuss the takeover bid.

The company issued issued a don't sell guidance yesterday to shareholders pending evaluation of the offer.

Market commentator Arthur Lim said it would be a brave firm that would want to take on such a substantial shareholding in Tourism Holdings.

"The company has sucked up a lot of capital and been the unmaking of quite a number of chief executives," he said. "For them [Ballylinch] to want to buy it they must see something in there that other shareholders and other companies over the years have not been able to see."

Tourism Holdings downgraded its profit forecast in February, revising a $2.5 million profit prediction made in December to a net loss of $4 million for the year ending June 30, 2011.

Tourism Holdings' other assets include the Kiwi Experience backpacker transport service and Waitomo Glowworm Caves.