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RIFA rolls up with offer for Airwork

NZ Newswire logoNZ Newswire 3/10/2016 Fiona Rotherham

Chinese company Zhejiang Rifa Holding Group (RIFA) has entered a takeover lock-up deed with the major shareholders in specialist aviation company Airwork Holdings at $5.40 per share.

Under the pre-bid deed, RIFA has agreed to make a conditional partial takeover offer for 75 per cent of Airwork's ordinary shares.

Parties associated with non-executive director Hugh Jones hold 58.943 per cent of the Auckland-based company.

The shares jumped 18 per cent to $5.20, having risen 30 per cent in the past year. Airwork floated in late 2013, selling shares in an initial public offering at $2.60.

Airwork's independent directors have advised all shareholders to take no action, pending further guidance from the company. It's understood that the deed intends a takeover notice being given on or prior to this Friday.

Airwork delivered a 58 per cent boost in net profit for the 2016 financial year to $24.6 million following strong earnings growth in its expanded fixed wing aircraft business which is expected to continue this year due to the impact of aircraft deliveries and new contracts.

The helicopter business also reported a solid performance with earnings growth of 16 per cent despite flat revenue.

The deed notice states the takeover will be subject to a number of conditions including agreement from the Commonwealth Bank, ANZ and BNZ to continue Airwork's current funding arrangements and agreement from joint venture partners to continue those arrangements on existing terms.

It will also require Overseas Investment Office and Chinese government approval.

The deed says the Hangzhou-headquartered company operates a diverse range of businesses, with total assets of US$1.1 billion ($NZ1.5b) generating annual revenue of US$250m ($NZ343m). It operates in seven countries including China, Australia and Italy, and its core business is textile machinery and electronic precision machinery.

RIFA said it intends maintaining Airwork's listing on the NZX main board and to support its existing business strategy and retain the corporate headquarters in New Zealand.

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