Hellaby Holdings is pursuing two or three possible acquisitions as it looks to make use of a growing pile of cash.
The Auckland-based investment company could have as much as $75 million available after selling yesterday its remaining 19.85 per cent holding in NZ Wool Services International to Woolpak Holdings for $6.9 million.
Hellaby chief executive David Houldsworth said yesterday the acquisitions being considered were small – in the $5 million to $6 million range. They were businesses that could be added to existing Hellaby operations.
Trying to buy bigger assets these days meant competing with private equity operators prepared to pay higher prices, he said.
“We’ve just got to place ourselves in areas they are not looking at,” he said.
The sale of the WSI holding follows last month’s $13.6 million divestment of retail menswear chain Rodd & Gunn and last week’s $55 million capital notes fundraising.
Hellaby also has some surplus properties on the market that could collectively fetch up to $5 million.
Mr Houldsworth was pleased with the price fetched for the WSI stake, which was $1.3 million more than its valuation on Hellaby’s financial books.
“WSI is an excellent company operating in a key sector of the New Zealand economy – wool scouring and exporting – but the investment no longer fitted with Hellaby’s strategic direction.”
Hellaby’s assets include the Hannah’s shoe business, 80 per cent of Number 1 Shoe Warehouse, BBQ Factory, Diesel Distributors and Brake & Transmission.
For the six months to December Hellaby made an after-tax profit of $9.3 million, down 9.7 per cent on the same period a year earlier.
Its last detailed forecast of earnings for the full year was for profit to fall between 5 per cent and 10 per cent below last year’s $19.9 million underlying profit.
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