FleetPartners

FleetPartners is a leading provider of passenger and commercial vehicle fleet management services in Australia and New Zealand. 
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Hirequip

Hirequip is New Zealand’s leading dry-hire equipment rental business. It offers a wide range of rental equipment across the full spectrum of the construction sector via a national branch network.
Read more . . .

Below are some examples of deals completed by Partners whilst at a previous employer.

• Loscam Limited
• Tempo Services
• Bledisloe Group
• Pacific Nursing Solutions
• Wizard/AFIG
• Pacific Apparel Solutions

Loscam Limited

Loscam is one of the largest returnable packaging hire companies in the world with a network of offices and operations through Australia and Asia. Loscam supplies pooled pallets and other products supporting the movement of industrial and consumer goods through the supply chain. Pooled pallets are critical to achieving efficiencies through the supply chain.

Rob Nichols and Gene Lorenz led the acquisition of the Loscam business from General Electric in a competitive auction. The bid was differentiated through the close partnership formed with Neil McBain, whom had previously run the Loscam business a number of years before.
The detailed business plan developed with Neil involved:

• the replacement of the entire senior management team
• increased focus on customer service delivery
• investment in modernising the depot facilities, and expanding the pallet pool especially in South East Asia.

The deal was recognised by the Australian Venture Capital Association with the award of the Best MBO in 2005.

www.loscam.com

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Tempo Services Limited

Tempo was Australia’s leading commercial cleaning business, had the second largest security business as well as a fast growing facilities management business. The business was listed on the Australian Stock Exchange but languished after a series of earnings downgrades, accounting irregularities and corporate governance issues.

Rob Nichols and Gene Lorenz led the public to private acquisition of the Tempo business through a scheme of arrangement. The bid involved the formation of a joint venture bid vehicle, Pacific Services Solutions, with the world’s leading facilities management business ISS headquartered in Copenhagen.

The detailed business plan developed with ISS involved:

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Bledisloe Group Pty Limited

Bledisloe is Australia’s second largest funeral services business and the largest operator in New Zealand. The management team was approached following detailed desktop research conducted by Rob Nichols on the sector in February 2005. The Bledisloe board of directors ran a thorough oversight process and only allowed DB Capital Partners to engage with shareholders after debt was secured from the Bank of Scotland.

The deal was structured to provide the existing shareholders an option to roll-over a portion of their equity into the new structure. The capital structure allowed for a sale and leaseback of certain property assets through a bridge facility. The strong management team led by CEO Phil Wikman and the chairman were all retained to continue their strong performance as one of the sector’s leading teams.

Bledisloe owns and operates funeral homes, crematoria facilities and cemeteries. The business was attractive as it had significant scale and operated under a “hub and spoke” model of shop fronts connected to larger funeral homes and related operating assets. The business offers prepaid funeral plans. The business operates through a plethora of local brands.

The opportunity to acquire a majority stake in Bledisloe was particularly attractive due to:

• strength and track record of the senior management team
• the high degree of fragmentation in the funeral services sectors where 75% of market share is held by small operators
• strong forecast growth due to the large “baby boomer” population in Australia
• significant operating leverage due to the relatively high portion of fixed costs in the business
• significant barriers to entry due to capital requirements, strong localised brands and regulatory barriers and locally planning consents required.

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Pacific Nursing Solutions Pty Limited
(renamed Healthcare Australia)

Pacific Nursing Solutions is Australia’s largest nursing agency business. It sources and provide quality nurses to public and private hospitals as well as aged care facilities.

Following an aborted acquisition attempt of a localised agency Rob Nichols and Gene Lorenz developed a detailed aggregation strategy to consolidate the highly fragmented nursing agency sector. The strategy involved acquiring a cornerstone business with strong systems and management and developing a geographically diverse and multi specialist nurse business along with a private and public sector homecare business.

A strong management buy-in candidate, Craig Rushton, was sourced ahead of due diligence commencing on the cornerstone target NAA. Craig had successfully lead the turnaround and exit of a private equity backed IT services business in the UK.

Once the cornerstone was in exclusive due diligence a further 6 acquisition targets were moved along to heads of terms stage before the cornerstone acquisition was completed. Within 18 months a total of 11 acqusitions were completed many of them sourced and negotiated by Rob Nichols.

The opportunity to build Australia’s leading nursing and homecare business was particularly attractive due to:

• strength and track record of both the CEO buy-in candidate and the founder of NAA whom became the non executive chairman
• the high degree of fragmentation in the nursing agency sector
• strong forecast healthcare demand due to the ageing population in Australia
• ability to integrate multiple acquisitions through a strong IT platform
• supply demand imbalance between nurse demand and supply

The deal was recognised by the Australian Venture Capital Association with the award of the Best Managment Buy-Out Less Than $50 million in 2006.

www.healthcareaustralia.com.au

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Wizard / Australian Financial Investments Group

Wizard (t/a Australian Financial Investments Group) was the leading non-bank mortgage originator in Australia. The business operated both franchisee and company owned store networks. Loans were written in the prime category only.

At the time of the investment the founder was seeking capital to enable the business to undertake an aggressive rollout of branches. The business successfully rolled out its satellite network, increasing its branches from 68 to 220 in three and a half years.

The investment rationale was based on:

• attractive sector growth of 15% pa
• major retail banks closing High Street branches providing a market opportunity for non-bank originators
• under-developed mortgage broker model with competitors using a mobile rather than fixed model
• opportunity to significantly increase the number of branches
• strong business platform using people from within the local community to head the individual branches
• variable cost distribution model with strong alignment of interest

Gene Lorenz in his role as DB Capital Partners’ lead director was significantly involved in the transformation of the business that saw:

• a successful store rollout,
• acquisition of the wholesale funding vehicle and 
• implementation of a shadow equity scheme to align key franchisees with shareholders.

In September 2004, Wizard was sold to GE Money delivering an IRR of 19%.

www.wizard.com.au

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Pacific Apparel Solutions

Pacific Apparel Solutions (“PAS”) was established as a vehicle to consolidate the fragmented but highly attractive wholesale apparel sector. A number of targets were sourced through proprietary research and were approached by Gene Lorenz as the sole DB Capital Partner's Director on the investment.

The investment rationale of the PAS roll-up was based on:

• attractive and fragmented sector, characterised by owner operator firms
• efficient offshore production requiring low capital investment
• sound fundamentals based on non fashion based wholesalers
• strong cashflow model
• opportunity to derive cost savings through combined procurement and logistics

Gene Lorenz led the establishment of the PAS platform including sourcing the senior management team and chairman, the first acquisition of Yarra Trail and sourcing and negotiating the subsequent acquisitions of Breakaway and Designworks. A deep pipeline of acquisition targets was developed including Hopkins Group which was acquired subsequent to Gene’s departure from DB Capital Partners in 2006.

The group has expanded significantly since the development of the initial concept and completion of the first three acquisitions to be one of Australia’s largest wholesale apparel businesses.

www.thepasgroup.com.au

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