Loxam/Nationwide acquires UK Platforms
UK general rental company HSS has agreed the sale of its UK Platforms operation to Nationwide Platforms/Loxam for £60.5 million. As part of the deal HSS has entered into a long-term strategic commercial agreement with Nationwide to provide powered access equipment.
The deal will generate £47.5 million in cash for HSS, which will use 80 percent of the net funds to pay down debt, with the balance - around £9 million - used for capital expenditure and upgrading of its core tool hire business. The company acquired UK Platforms in July 2013 from Haulotte (See HSS acquired UK Platforms
) and runs a fleet of 3,000 aerial work platforms.
The deal is conditional and subject to HSS shareholder approval at a general meeting in August. It is expected to be completed during the fourth quarter.
HSS chief executive Steve Ashmore said: "Today's announcement is another step forward. It will accelerate progress against our strategic priorities, enabling further deleveraging through debt reduction and allow greater focus on our core tool hire business. The UK Platforms business has made an excellent contribution to the group over recent years but considering our priorities and focus on tool hire we feel it will reach its full potential under new ownership. We will continue to provide our customers with all of their powered access needs through our existing fleet and the new strategic partnership with Nationwide."
In a letter to UK Platforms employees, Don Kenny, chief executive of Loxam Access said: “We are very excited about the proposal to bring together two prominent UK providers of Powered Access rental. Both organisations have strong reputations in the UK market as reliable and professional providers of electrical, diesel and bi-energy powered access equipment to their combined UK customer base. We believe this acquisition is an exciting venture for us, which presents the opportunity to increase our fleet and customer portfolio whilst strengthening our joint market position. The diversification of our UK activities will offer great opportunities to our workforce in career development, training and the prestige of working for one of the world’s largest equipment rental companies, Loxam Group.”
HSS has struggled for some time now as it coped with its large debt pile in what has been a rental market for small general equipment and tools. UK Platforms and its other specialist divisions have been the star performers of the business and as a result the most saleable.
The move will give Nationwide Platforms a combined fleet of more than 15,000 units and some significant re-rent opportunities through the HSS network. The company which has been owned by French rental group Loxam since February 2017, more recently merged its operations with Loxam UK, while Nationwide Platforms chief executive Don Kenny took up a new role heading up all of Loxam’s European specialist access operations under a new Powered Access Division. Nationwide has also been offering its customers a range or other equipment such as telehandlers, excavators and skid steer loaders supposedly as part of a re-hire deal with Ardent.
Whether this move will be enough to fully revive HSS’ fortunes in the face of a strong A-Plant, a resurgent Speedy hire and some rapidly growing independents such as Charles Wilson and Gap, remains to be seen.
It will not be easy.