Mainfreight takes wheel at Owens

By PAM GRAHAM

Mainfreight will start running rival Owens Group from Monday, and is vowing to build "two valuable New Zealand transport companies" to compete with Toll Holdings of Australia.

It declared its offer for Owens unconditional yesterday, deciding to live with Toll as a minority shareholder.

Mainfreight waived a 90 per cent acceptance condition after receiving pledges for 78.63 per cent of the company. All Owens family members pledged their holdings.

Toll stopped Mainfreight from getting to 90 per cent, the level that triggers compulsory acquisition of remaining shares, by buying an 11.88 per cent stake from AMP Henderson. It paid $1.15 a share, 5c more than Mainfreight was offering.

Mainfreight wanted total control of Owens to create a large transport company to compete with Tranz Rail, which is controlled by Toll Holdings.

The Toll minority stake means Owens will stay listed and must be run as a separate company.

"We see it as a very little problem," said Mainfreight managing director Don Braid.

"We are proud to be Kiwis running these businesses and we look forward to New Zealanders helping us."

Toll faces similar issues with minority shareholders who prevented it taking over all of Tranz Rail. The role of independent directors and the level of integration with Toll's Australian businesses are expected to be closely watched.

Braid said Mainfreight would be "into it" at Owens from Monday morning. He had no comment on whether job losses were likely.

"We are looking forward to working with the people of Owens and the customers of Owens," he said.

The new Owens board will be chaired by Bruce Plested, Mainfreight's founder. Warren Larsen and Denham Shale from Owens will stay and Don Braid and Carl Howard-Smith from Mainfreight will join. Toll will not be represented.

Braid said there had been no discussion with Toll since it had bought the stake.

Mainfreight is paying for the purchase with bank loans and plans to raise equity later, but has not given details.

In another twist yesterday, K&S Corp, a South Australian-based listed transport company, said it had bought Cambridge-based Cochrane's Transport for an undisclosed sum.

Cochrane's has about 40 trucks, a staff of 50 and turnover of $10 million. It has a joint venture that distributes finished product nationally for Fonterra and also services the kiwifruit industry.

K&S has been in New Zealand for about 18 months and delivers newsprint for Norske Skog.

K&S has a market capitalisation of A$139 million ($160 million) compared with Toll Holdings's A$2.6 billion. Toll shares were at a 52-week high yesterday.