Tourism buy may cue Tasman move

By Karyn Scherer

New Zealand's biggest tourism company is not ruling out eventually moving to Australia, after a $166 million deal across the Tasman.

Tourism Holdings, which is probably best known as the owner of prime tourism attractions such as Kelly Tarlton's aquarium and Waitomo Caves tours, has no plans at this stage to shift its headquarters.

But it conceded yesterday that it could not rule out a move in the next decade, as tourism growth in Australia is expected to outperform New Zealand in the long term.

The company, formerly known as the Helicopter Line, has made it clear it sees big opportunities across the Tasman and is predicting that by 2001 more than a third of its revenue will come from Australia.

A large chunk of that is expected to come from the purchase of Britz, the privately owned Australian-based rival to its Maui campervan business.

It revealed yesterday it had received preliminary approval from both New Zealand and Australia's competition watchdogs to buy the company.

It has agreed to pay $62 million for the business, subject to shareholder approval and a successful rights issue that is intended to raise $38 million. It will also assume liabilities for the Britz campervan fleet of about $104 million.

Britz' Australian owners, the Gschwenter family, will receive part of the purchase price in THL shares, which will give them a 15 per cent stake in the company.

Together, Maui and Britz are believed to hold just over half the New Zealand market and nearly 60 per cent of the Australian market for campervan rentals. Both companies also operate in South Africa, although these arms have been tagged for sale.

Both brands will be retained, although their operations, which closely match each other, will be merged in a move that is expected to save $8.5 million a year.

The deal will make Tourism Holdings the largest international player in campervan rentals and will propel it into the New Zealand stock exchange's list of top-40 companies.

Managing director Dennis Pickup confirmed the company was also considering a listing on the Australian exchange.

The move comes amid a restructuring of the company, which is now almost unrecognisable from its beginnings in commercial aviation.

An assets-disposal programme to reduce its debt has seen the group pull out of accommodation, wholesaling and many smaller tourism ventures. The programme is now largely complete.

Brokers have been tipping the company as a hot investment since the beginning of the year - advice which proved sound yesterday, with confirmation that it had made a slightly-higher-than-forecast after-tax profit of $6.7 million for the year ending June.

The result, based on a 33 per cent increase in turnover to $166.5 million, compares with last year's profit of less than $1 million, and comes after deducting one-off costs of more than $4 million.

As previously signalled, the company has resumed paying dividends after a two-year hiatus. Shareholders registered on October 8 will receive a fully imputed dividend of 5c per share on October 26.

Its shares closed last night down 10c to $2.70, nearly four times higher than this time last year.