Perth companies Total Eden Watering Systems and Emeco Holdings aim to crank up their growth via new acquisitions after completing multi-million dollar deals with private equity funds.
Emeco, Australia’s largest provider of earthmoving equipment, has raised $50 million in fresh equity from its two principal shareholders, Archer Capital and Pacific Equity Partners.
Archer and PEP acquired Redcliffe-based Emeco for $499 million late last year in one of Australia’s biggest private equity deals.
Emeco managing director Laurie Freedman said that, as well as raising new equity, the company was negotiating a $175 million increase in its loan facilities.
He said the extra funding was driven by strong demand for its services and its ongoing search for acquisition opportunities.
“The additional $225 million of capital provided by our shareholders and banking syndicate will enable the Emeco Group to exploit a range of attractive growth opportunities in Australia and internationally,” Mr Freedman said.
Emeco has achieved rapid growth in recent years, with total revenue increasing from $131 million in 2002 to $292 million in 2005.
It said the main growth drivers were the Australian and Indonesian markets. The company is seeking to expand in North America and Europe.
Meanwhile, AMP has acquired a 65 per cent shareholding in Total Eden and a group of 10 managers has acquired 20 per cent, leaving company founders Ken and Ian Pitts with 15 per cent.
Ian Pitts said the company, which has annual turnover of $40 million, wanted to expand nationally through the acquisition of other like-minded irrigation businesses. Mr Pitts said he and his brother, Ken, would stay in the business for a further three to five years.
AMP is now a substantial shareholder in five private Western Australian companies.
It has invested $16 million in trucking company Mitchell Corporation and $11 million in industrial supplies business Heatley Sales, made an undisclosed investment in WA Forktrucks and is a long-standing shareholder in Canning Vale Weaving Mills.
