25.09.2017

Seven to take all of Coates

Australia's Seven Group has said that it plans to buy Carlyle’s holding in rental company Coates Hire for A$517 million ($411 million) along with shares held by minority stockholders to give it outright ownership of the business. Seven currently holds 46.7 percent of the company’s shares.

Seven will fund the purchase with existing debt and cash, including proceeds from the recent sale of WesTrac China, it will also assume all of Coates's A$1.04 billion ($800 million) in debt. Carlyle and Seven acquired Coates in 2007 in a deal that valued the business at A$1.7 billion.

Seven group chief executive Ryan Stokes said: "We have had a long history with the Coates Hire business and believe with the visible market opportunity associated with East Coast infrastructure activity, along with the current performance of the business and management team, the company is extremely well positioned."

Vertikal Comment

Seven acquired Coates through its National Hire business and has been looking to buy out Carlyle since 2011, with the two also having looked at selling the business to a third party on a couple of occasions. With the business back in profit and a positive outlook the timing is probably as good as it is likely to be. The move is unlikely to have any material day to day impact on Coates.