By GEOFF SENESCALL
Excell Corporation shareholders Eric Watson and Wayne Hartner are looking to raise $30 million to finance the company's rapid expansion.
Bought from Manukau City Council two years ago for $25 million, the infrastructure business has seen its annual turnover treble since then to around $180 million, for work ranging from park maintenance to civil engineering.
Staff numbers have grown at a similar pace, with 1550 now on the payroll.
As Excell chief executive Earl Stevens said: "We've undergone tremendous growth.
"This is a response to winning contracts and also in response to buying companies.
"So it all soaks up capital. We've got something like $80 million invested in the business now, which has doubled in the last year."
The move to raise cash was not because Excell was starved of capital, Mr Stevens said.
"We just see the opportunity for someone else to come in and actually contribute some more for the pot."
This process was also not about Mr Watson and Mr Hartner selling shares, he said. However, they would be diluted through the issue of more stock.
Depending who bought in, a listing was possible at some point. But this was an expensive option and furthermore, it opened up the company's operations to its competitors.
The company also had a lot to do before it was ready to go public.
So far, around 10 financial institutions and six trade players have been approached.
If Excell was successful in raising $30 million, Mr Stevens said, it would enable the company to expand its revenue by a further $80 million to $100 million.
"This will give us a few more strings to our bow. We would like to invest in allied businesses."
Excell had a particular target in mind in the civil works area. If it wanted to be a serious player in roading, the company needed to invest in bitumen and asphalt operations.
At the moment, Mr Stevens said, this market was dominated by Works and Fulton Hogan.
Basically, a company needed to have size and scale as competition was strong and margins slim.
Excell was also looking at opportunities, particularly in Australia, for its outdoor spaces business. While its outdoor maintenance business was important in New Zealand, that area made up half of the company's activities in Australia.
"We maintain about 60 per cent of Melbourne these days, and some 15km of its foreshore," Mr Stevens said.
That includes parks, reserves, roadsides and gardens.
"We have also got a big chunk of Canberra to look after.
"We have got a couple of high-profile parks in Sydney - Centennial Park and Parramatta - and we look after about a third of Brisbane and we also have a tourist park further north of Harvey Bay."
All the parks and reserve work in Australia came from winning contracts. The company's work there now accounts for around $70 million of its $180 million turnover.
Although it bought a roading and construction company in Australia last year, Excell was just a minnow compared with some of its competitors. Australian companies were competing for work in New Zealand and vice versa.
It was a tough market, Mr Stevens said. There was no time to just stand still.
Excell seeks $30m to sustain bloom
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