National Hire and higher and higher18/12/03 By: Andrew...

National Hire and higher and higher
18/12/03 By: Andrew Nelson

National Hire Group Limited (NHR) shares were at a two year high today on the back of last night’s announcement that they will place 100,000,000 shares, at 25c each to Kerry Stokes’ WesTrac Equipment Pty Ltd. The deal will see the company raise $25 million in capital and make WesTrac the new majority shareholder with 60% of the capital base.

The 25c subscription price is a 56% premium to the recently completed rights issue; it also represents a 22% premium to the market price of National Hire shares of 20.5c on 12 December; as well as a 23% premium to the volume weighted average of a National Hire share of 20.4c over the last three months.

The company advised that the funds would be used to expand the equipment fleet, branch network and to roll out new rental stores.

“The company will become the become the second largest listed hire company in Australia and well placed to achieve our strategic intent of becoming an ASX 300 company,” said Mr Stephen Donnely, managing director of National Hire.

WesTrac is currently the Caterpillar dealer for Western Australia and is slated to become the dealer for New South Wales and the ACT in April. The deal, subject to approval from Caterpillar in the US, will see National Hire re-brand its NSW rental stores to Cat Rental Stores from April.