One of New Zealand’s largest transport operators, Ritchies Transport Limited has been sold to major global venture capital company KKR after 86 years in the hands of the Ritchie family.
The global investment firm, announced the signing of agreements to acquire Ritchies, marking KKR’s first infrastructure investment in New Zealand .
KKR or Kohlberg, Kravis Roberts, was founded in 1976 by Jerome Kolberg, and cousins Henry Kravis and George Roberts, all of whom had previously worked together at the eventually ill fated Bear Stearns investment bank, where they completed some of the earliest leveraged buyout transactions. KKR has completed a number of headlining grabbing company takeovers with possibly the most famous being the 1989 leveraged buyout of US food and topbacco giant RJR Nabisco, which was the largest buyout in history to that point, as well as the 2007 buyout of US energy company TXU, which is currently the largest corporate buyout completed to date
Ritchies was founded in the NZ country town of Temuka in 1935, and today has a fleet of more than 1,600 vehicles and a network of 42 depots across the country, provides government, local councils, and private customers with public transport bus services across New Zealand.
Once the transaction is completed the Ritchie family will continue to hold a stake in the company with . Andrew Ritchie to be appointed CEO while his uncle and current managing director,Glenn Ritchie is set to retire.
“This deal is a real milestone for our business. After 86 years, we are confident that the Company will continue to demonstrate the family values that have been a strong part of our identity and culture, as we’ve built Ritchies into one of New Zealand’s largest and most successful transport operators,” Glenn Ritchie said,
Andrew Ritchie who is currently director of operations said that joining KKR is the start of an exciting new chapter for the company.
“Glenn has been an integral part of the business for most of his life, and been instrumental in helping the company achieve its growth and success as a nationwide transport operator. He has left an indelible mark on the company and its staff and will be missed,” said Andrew Ritchie.
“We would like to thank our many loyal customers and staff all over New Zealand, many of whom have been with Ritchies along our journey. Now it’s time to leverage KKR’s expertise to help take Ritchies forward as we look to the next 86 years. We were very impressed by KKR’s long track record of adding value to the businesses, investments and acquisitions they have made across numerous industry sectors around the world,” added Andrew.
David Luboff, partner and head of Asia Pacific Infrastructure at KKR, said that for over 80 years, Ritchies Transport has been the trusted provider of local and regional transport in communities across New Zealand, and that the company was excited to invest in a successful, leading business like Ritchies and work alongside its talented management team.
“Our investment also reiterates KKR’s strong commitment to investing in critical infrastructure assets in New Zealand and globally through our expanding portfolio,” said Luboff.
The statement fro the company said it was is making the investment from its KKR Asia Pacific Infrastructure Fund, and while additional details of the transaction were not disclosed, it did say that the purchase was also subject to ‘customary closing conditions ‘and is also conditional on approval from New Zealand’s overseas investment approval authority, the OIO which it says is expected within four to five months.