Japanese suitor lines up for Tait stake
The mystery investor seeking a slice of Tait Communications has been revealed as Tokyo Stock Exchange-listed JVC Kenwood.
Tait signalled about two years ago that it needed more money to develop products and marketing, and last year raised $57 million through the sale of its headquarters in Christchurch.
Tait chief executive Garry Diack declined to comment on a meeting he held to update some of the 650 staff on progress in seeking investment money.
The employees learnt that the company was exploring a relationship with JVC Kenwood, which was keen to take a minority shareholding.
The deal would depend on more due diligence and consent of the Overseas Investment Office.
JVC Kenwood is a large corporation many times the size of Tait, and is involved in car navigation and audio systems, making up 57 per cent of its income.
Its other businesses include public-sector radio services, and sales of video cameras, headphones and other devices, plus display devices for entertainment products.
The company recently told the Tokyo Stock Exchange of its intention ‘‘to consider acquiring shares of Tait’’ and said it had entered into a memorandum of understanding.
‘‘JVC Kenwood and Tait are currently considering details including the percentage of share acquisition and scope of business cooperation,’’ JVC Kenwood said.
To enable the new investment, Christchurch-based Tait had to remove the obstacle of its trust ownership, which was set up by founder Angus Tait with the aim of preventing foreign takeover.
Alongside the trusts, the Tait board set up a new, New Zealand parent company called Tait International to accept external investment.
All the substantive businesses currently operated by Tait will be transferred to Tait International by the time JVC Kenwood’s investment is finalised.