Overseas investment decision for case 200720077 - Transfield Services (New Zealand) Limited

To acquire:

1. up to 100 percent of the shares of McBreen Jenkins Construction Limited;
2. 52.565 hectares of leasehold, and if an option is exercised a freehold estate in land, situated at Russell Quarry, Russell Road, Russell; Carrs Quarry, One Tree Point Road, Kawakawa; Kawakawa Quarry, Kawakawa being CTs 176310, NA 135C/176, NA 97A/832 and NA97A/833 (North Auckland Registry);
3. 2.0186 hectares of leasehold situated at 59 Glenlyon Ave, Tauranga being CT SA 61B/336 (South Auckland Registry)

The application has been approved as it met the criteria.

The Overseas Investment Office is satisfied that the individuals with control of the Applicant collectively have business experience and acumen relevant to the overseas investment, and that the Applicant has demonstrated financial commitment towards the overseas investment. The Overseas Investment Office is further satisfied that each individual that exercises control over the Applicant is of good character and is not an individual of the kind referred to in section 7(1) of the Immigration Act 1987.

Outline of the proposed investment:
Transfield Services (New Zealand) Limited (Transfield) has entered into an agreement with BBM Holdings Limited (BBM), formerly McBreen Jenkins Investments Limited, to acquire all of the shares in McBreen Jenkins Construction Limited (McBreen Jenkins Construction). The business activities of McBreen Jenkins Construction include civil and roading construction and maintenance activities and quarrying.

McBreen Jenkins Construction owns six properties and leases or has quarrying rights in respect of twenty properties. It is proposed that five of the six owned properties will be sold to BBM on settlement of the acquisition of the shares. One property will be sold to BBM prior to the settlement of the transaction. BBM will lease four of these properties back to McBreen Jenkins Construction from the settlement date.

Rationale for the Proposed Investment:
The acquisition will provide Transfield with a stronger market presence in the large and rapidly growing roading construction, maintenance and associated industries in New Zealand. The key strategic opportunities for Transfield include:

1. strengthening Transfield's position in road construction and infrastructure maintenance in general, specifically in the Northland and Bay of Plenty regions where Transfield is not currently represented with its infrastructure services;
2. providing access to McBreen Jenkins Construction's key competencies and experience in road construction and maintenance, at a time when skilled labour is in short supply; and
3. positioning Transfield to take advantage of the significant increase in infrastructure spending by central and local governments across New Zealand.

The proposal is likely to result in the following benefits:

1. the creation of new job opportunities in New Zealand;
2. increased scale and increased efficiencies to Transfield's roading and civil works operations; and
3. the introduction into New Zealand of additional investment for development purposes.