Ann: GENERAL: THL: thl announces Joint Venture Ma

• Release Date: 21/02/12 11:51
• Summary: GENERAL: THL: thl announces Joint Venture Manufacturing business
• Price Sensitive: No
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THL
21/02/2012 09:51
GENERAL

REL: 0951 HRS Tourism Holdings Limited

GENERAL: THL: thl announces Joint Venture Manufacturing business

21 February 2012

Joint Venture Manufacturing business
This release provides the background to the new manufacturing joint venture
announced today.
thl has entered into a series of agreements to form a joint venture
manufacturing business in New Zealand with Kea Manufacturing (New Zealand)
Limited (KMNZ). The new venture will be conducted as a limited partnership
called RV Manufacturing Group LP (RVMG).
RVMG will commence as a 50/50 partnership between thl and KMNZ.  The
transactions forming the joint venture will include:
(a) thl and KMNZ selling their respective motorhome and campervan
manufacturing businesses to RVMG. The consideration payable to thl will be
based on the book value of the assets transferred. Part of the consideration
will represent thl's capital contribution to RVMG and the remainder will
remain outstanding as an advance from thl to RVMG. The thl and KMNZ
agreements are unconditional and will settle on 1 March 2012 unless otherwise
agreed by thl and KMNZ.

(b) thl is also selling its specialist and body work business to RVMG. The
consideration payable to thl under this agreement will also be based on the
book value of the assets transferred. This amount will remain outstanding as
an advance from thl to RVMG. The sale of this business is conditional on the
assignment of certain key customer contracts and the lease of thl's Motek
Specialist vehicles site in Hamilton.  If those conditions are not satisfied
by 31 August 2012 the parties may terminate the agreement, though this will
not impact on the assets transferred under (a) above.
The transactions will see circa $7.5m in assets transfer from thl to RVMG and
is not expected to have any negative impact on the FY2012 EBIT result for the
business.
The building owned by thl in Hamilton (purchased in 2011) will remain with
thl.  The building will be marketed for sale in due course.
As a result of the transactions, RVMG's primary manufacturing facility will
operate from the existing Kea Manufacturing plant in Auckland (Albany) and
the specialist and body work business will operate from thl's Motek
Specialist vehicles site in Hamilton. thl's motorhome assembly business in
Hamilton will be closed as a result of the joint venture.
The thl businesses in Hamilton employ 127 people of which 63 will be made
redundant.
This joint venture has no impact on the rentals and vehicle sales businesses
that operate under the thl and Kea rental brands.
RVMG will be led by Grant Brady, the current Managing Director of Kea
Manufacturing, reporting to the board of the joint venture.
The transaction is not expected to have any negative impact on the full year
EBIT expectations for the business.  Further commentary and details of the
transaction will be included within the thl half year result pack which is
due to be released to the market on Thursday 23rd February.

Announcement authorised by:

Keith Smith
Chairman
Tourism Holdings Limited

For further information contact:

Grant Webster
Chief Executive
Tourism Holdings Limited
Direct Dial: +64 9 336 4255
Mobile: +64 21 449 210

Ian Lewington
Chief Financial Officer
Tourism Holdings Limited
Direct Dial: +64 9 336 4212
Mobile: +64 21 952 254
End CA:00219784 For:THL    Type:GENERAL    Time:2012-02-21 09:51:07