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Direct Capital Completes Investment in Scales Corporation
22/07/2011

Direct Capital Completes Investment in Scales Corporation

Direct Capital is pleased to announce that its investment in Scales Corporation has now been completed following the obtaining of shareholder approval for the transaction.  

Through its Direct Capital IV and Pohutukawa II funds, along with co-investment partners, New Zealand Superannuation Fund and ACC, the acquisition of the 79.7% shareholding in Scales was first announced in May 2011 and was subject only to obtaining shareholder approval.  A special meeting of shareholders was held in Christchurch on the 20th of July and the transaction has now been approved.

Scales was formed in 1912 and is one of New Zealand’s oldest companies.  Based in Christchurch, the company has group revenues of more than $200 million, employs a permanent workforce of 375 and operates from a number of sites across New Zealand. 

Scales is a leading New Zealand horticulture and primary sector processing exporter and logistics business.  Its operating businesses include Mr Apple, the largest grower, packer and exporter of apples in New Zealand, Meateor Foods a convertor of processed meat into the local and international pet food market, and Storage and Logistics in which it operates a number of cold store and bulk liquid facilities and logistics support services. 

It is expected that two Direct Capital representatives, Mark Hutton and Tony Batterton, will join the Scales board.  The investment in Scales Corporation is the fourth investment from the Direct Capital IV fund which raised $325 million in December 2009 for investment into New Zealand private companies. 

“Our recent investments reflect the global strength of New Zealand’s position in the food and soft commodity sectors.  Scales Corporation continues this investment theme. It is a diverse business but one that is centered on horticulture, growing its exports into Asia and providing storage and logistics infrastructure to support its own and other food and agri businesses in New Zealand. We look forward to supporting the Scales management team with their plans to develop and grow the Company.” said Direct Capital’s Mark Hutton. 

Direct Capital III & IV portfolio companies in aggregate generate more than $1 billion in annual revenues, of which greater than 50% represent export sales or sales generated by overseas subsidiaries, and employ more than 3,600 staff.  Current and past investments include: Cavalier Wool Holdings, Bayley Corporation, Transaction Services, Fishpond, New Zealand King Salmon, Rodd & Gunn, GoBus, Shears & Mac, Innovair, Triton Hearing Clinics, Stratex Group, Max Fashions, New Zealand Pharmaceuticals, Express Logistics, Ryman Healthcare, Nobilo Wines, Airwork, EFTPOS NZ, Tasman Building Products, EziBuy, and PC Direct.

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