Reweti Kohere, NBR:
Māori direct investment fund Te Pūia Tāpapa has made its first investment, with the target company TR Group’s managing director “absolutely rapt” with its new partner.
The long-mooted indigenous investor has teamed up with preferred partner NZ Superannuation Fund and fund manager Direct Capital to purchase a 31% stake in heavy vehicle fleet lender TR Group for an undisclosed sum.
Direct Capital has held 30.71% of the company since last Tuesday, according to the Companies Office register, with director Hugh Cotterill also appointed to TR Group’s board on July 7. The Kiwi venture firm bought out Australian private equity firm Champ Ventures.
Te Pūia Tāpapa is made up of 26 iwi and Māori organisations, and has had $115.5 million to play with since it was established in 2018. Its information flyer notes a preference for investing between $10m and $40m for a 10-50% stake.
“The Te Pūia Tāpapa whānau are delighted that their first investment achieves all the fund’s objectives,” chair Paul Majurey said.
“This is an attractive investment. TR Group is the market leader in heavy vehicle fleet leasing and rental with a fleet of over 5,700 trucks, trailers and buses, and 12 branches in Aotearoa. Coupled with that, transport and logistics is a fast-growing sector.”
TR Group managing director Andrew Carpenter told NBR he was “absolutely rapt” the investor was a part of the company, largely because it connected with Māori values.
Our love and life
Carpenter knew Māori invested for the long-term, focused on leaving matters in a good state for the next generation.
“I love that. It’s absolutely us as well. I’m looking forward to getting to know them a little bit and I think, from that point of view, we should get on really well.”
Established in 1992 by Andrew Carpenter and his father, Ron, TR Group has a fleet of 6500 rental and lease vehicles in New Zealand across 12 branches, with a team of about 170 employees. A year ago, it bought Melbourne-based Semi Skel Hire, the largest rental operator of its type in Victoria, with nearly 1200 trailers available for hire.
Financial statements filed with the Companies Office show the firm made $246 million in sales in the year to March 31 2019, up from $227m the previous year, while net profit after tax was $19.3m, down from $28.3m the prior year.
While Carpenter declined to disclose the investment sum, he said he was “very happy” with it and that the change in ownership meant it had not only come back into New Zealand’s hands but also into Māori hands.
“Our love and life is hiring trucks and trailers,” he said. “That’s where our thinking starts every morning and finishes every night so this kind of thing is important but we just want to have someone who’s supportive of helping us do the things we love doing every day.”
The long term
Majurey said TR Group had shown a consistent track record of growth over the past 20 years.
“The transport sector’s contribution to GDP has grown materially faster than the whole economy in recent years. Having a position in a growing economic sector, which is likely to keep growing and benefit from replacement of NZ’s ageing truck fleet and decarbonisation, is very attractive.”
Long-mooted Te Pūia Tāpapa looks for Aotearoa-based opportunities in high-quality assets across local markets, and favours long-term prospects given its aspirations of inter-generational wealth.
Named after a cluster of seedbeds used to grow kumara, Te Pūia Tāpapa has always focused on investing with others in New Zealand businesses and assets, Majurey said.
“This reflects the Māori long-term world view, with investment periods of 15-20 years.”