Forklift News - BRAMBLES CLOSES AUSSIE RENTAL FLEET DEAL

SYDNEY, Australia -- Brambles Industries Ltd has sold its Australian forklift rental business to US company Nacco Materials Handling Group (NMHG), manufacturer of Hyster and Yale forklifts.

Brambles chief executive officer John Fletcher said the sale, foreshadowed at the company's November 10 annual general meeting, would generate close to A$84m and result in a "modest after-tax loss".

The Australian materials handling industry had, since September, believed NMHG was a leading contender for the purchase of the fleet business, which was described in Brambles' annual report as "not expected to continue to grow in the short term" and "facing a period of cyclical downturn and intense competitive pressure".

NMHG Asia-Pacific Pty Ltd spokesman Andrew Dickson told forkliftaction.com in September that no "official" negotiations had been entered into.

NMHG has the second-largest fleet rental company in Australia, behind Brambles. The group has more than 3000 machines throughout Australia, ranging from less than one-tonne to 48-tonne trucks. The acquisition of Brambles' estimated 5000 units means NMHG will be Australia's largest forklift rental company.

Mr Fletcher said the sale was a "good outcome for shareholders, given the rapidly deteriorating equipment rental market".

"Structural changes in the forklift rental market globally, resulting from the emergence of financial institutions and manufacturers as competitors, meant future returns from these activities will not meet Brambles' long-term objectives," he said.

Brambles has already announced that a key part of a new five-year strategy would be shifting investment from low-growth to high-growth business.

At the annual general meeting, Mr Fletcher said a sale of the Gardemann access equipment business in Germany was also being considered.

Brambles' annual report said: "Trends in the European forklift rental business were similar to the Australian experience ... Because of this, the company is attempting to divest its forklift activities on both continents".

NMHG Asia-Pacific managing director Donna Baxter said the Brambles acquisition was an "excellent strategic fit" for the company.

"The combination ... creates the first national forklift rental business, with a presence in every state in Australia," she said.

Ms Baxter said NMHG would now expand its coverage in Australia, and look to employ additional support personnel to better service its clients.
The sale would be subject to approval by the Australian Competition & Consumer Commission, but ACCC chairman Allan Fels was unavailable for comment at press time.

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