Investors renew energy levels at Fencemakers

27/02/2008 - 22:00

Bookmark

Save articles for future reference.

Kevin Gray is one of thousands of Western Australian business people who have carved out a successful niche and ridden the economic boom.

Investors renew energy levels at Fencemakers

Kevin Gray is one of thousands of Western Australian business people who have carved out a successful niche and ridden the economic boom.

For 18 years, Mr Gray has been at the helm of Fencemakers, a made-to-measure producer of metal fencing for pools, security and residential subdivisions.

During that time he has moved premises four times – once due to a factory fire – ending up in Malaga with a workforce that stretches to 22 in the busiest times, which have become more frequent during the past few years of the property boom.

But Mr Gray admits there was a limit to the enthusiasm he could find to grow the business as life took him in other directions, such as property development.

“I was losing interest,” he says, surrounded by cricket and rugby sporting memorabilia in an otherwise no-frills office at the front of a large and busy tilt-slab factory in the heart of this thriving industrial zone.

Fencemakers had been on the market before, but it was somewhat out of the blue that a group of private investors made an approach recently.

That was only November and already, with new capital, financial expertise and board members, the partnership is cooking-up expansion plans, even though Mr Gray has stepped down to between two and three days in the office.

Tri Suseno and Joe Dinh, from fledgling consultancy, corporate advisory and investment firm, Akamai Management Group, now represent a significant part of the business and have big growth plans.

“This is giving me renewed vigour,” Mr Gray said.

“Joe and Tri are both enthusiastic.

“They want to see the business grow. I probably needed someone to kick my butt.”

The business is examining a number of options, from bolt-on businesses, geographic expansion and diversifying into related but previously untouched fields – acknowledging that the heated market for property and businesses does make strategic plays potentially capital intensive.

Mr Gray said the partnership had allowed him to pursue his property interests while maintaining an equity interest in Fencemakers, which he oversees through a full-time general manager.

The introduction of new partners had not been imposing, though he concedes it’s early days in the relationship.

“With a public company, everything has to be open, absolutely open, fair and honest,” Mr Gray said.

While having cash to spend on his investment pursuits is a big benefit, he said the fact that he could no longer take funds from the business for whatever he needed took some getting used.

Mr Suseno, who started corporate life with the now-defunct Poynton and Partners and went on to work for Richard Pratt in his Visy packaging products business, sees Mr Gray’s continuation with the business as important.

“We like to work with the best,” Mr Suseno said.

He described Mr Gray as a teacher and a coach to his staff, pursuing the quality end of the market and gaining a reputation that was attractive to an investor.

Mr Suseno and his partner, Brian Siddall, started Akamai less than a year ago and already have 12 staff. Akamai has also invested in Australian Blowmoulding Corporation, a Victorian manufacturer of plastic bottles.

He said he had access to patient capital for investments of as much as $300 million, but they had to be in a business that the group understood, and which had a high return on tangible assets over time.

In addition, Akamai staff, such as Mr Dinh who works in the group’s mergers and acquisitions advisory division, were encouraged to get involved in the equity and management of investments.

“He (Joe) was in charge of the acquisition process,” Mr Suseno said. “It was real and practical.”

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options