JUCY Group sells rental business
Lander & Rogers has advised on the transaction which saw distressed JUCY Group sell its rental business following the impact to the tourism sector off the back of the COVID-19 pandemic.
Firm: MinterEllison (JUCY Group); Lander & Rogers; Duncan Cotterill (Polar Capital)
Deal: JUCY Group has sold its car and campervan rental business in Australia and New Zealand to Polar Capital.
Key players: Corporate partner Jared Smith represented on behalf of Lander & Rogers, while M&A partner Mark Cathro represented Duncan Cotterill.
Deal significance: JUCY Group was founded in 2001 by New Zealander brothers Tim and Dan Alpe.
Operating in New Zealand, Australia and the US, JUCY had grown to amass a fleet of more than 4,000 vehicles, however, made the decision to restructure to secure the future of JUCY Rentals and 150 remaining jobs as a result of the impacts seen on the tourism sector from the pandemic. The group has witnessed a 90 per cent reduction in revenue and an estimated 60 per cent reduction in staff since March this year.
For the transaction, New Zealand-based firm Duncan Cotterill worked with Lander & Rogers, “which managed jurisdiction-specific requirements including advising on the Australian Government’s JobKeeper eligibility requirements for the company’s Australia-based staff, corporate and premises related compliance issues and Foreign Investment Review Board (FIRB) approval requirements regarding foreign investment in Australia”.
“The multi-jurisdictional deal was complex with tight timeframes. It was important to secure funding for the distressed asset before the group was placed into receivership. Retention of JobKeeper eligibility was a key aspect of how this deal was structured and is a common theme of distressed transactions right now,” Mr Smith said.
“FIRB’s expedited approval gave us confidence that, in distressed transactions in particular, a well-supported case for urgency, a strong case for saving Australian jobs and upfront investment in a quality FIRB application can produce deal-saving results.”
Going ahead, Mr Smith said Australian deal activity related to distressed businesses had risen over the last few months, with further deals currently in tow.
“There is strong appetite from local and foreign investors to capitalise on opportunities in impacted sectors, including tourism and hospitality. We expect this type of deal activity to continue into next year as struggling business seek support and global businesses seek to exit non-core jurisdictions and assets,” he said.