28 Jan 2013

VINZ bidder says planned WoF changes won't affect offer

9:08 am on 28 January 2013

A bidder for Vehicle Inspection New Zealand says planned warrant of fitness changes will not affect its sweetened takeover bid.

The Government's planned changes will see fewer cars needing six-monthly checks and the newest vehicles not tested for three years following an initial inspection.

The overhaul is expected to save motorists, businesses and the Government $159 million a year.

That may hit earnings at providers like Vehicle Inspection New Zealand (VINZ) which is the target of Japan-based vehicle inspection company Jevic.

Jevic raised its bid for VINZ by 30% to $2.15 a share on Friday, securing the support of VINZ's directors.

Jevic chief executive Euan Philpot said it has not overpaid given the proposed changes and he expects VINZ to thrive through new investment, and developing new services to assist transport operators.

He says it will create some opportunities for those in the industry to create new services, particularly in the warrant of fitness area.

Mr Philpot says the move away from a six-monthly check shows the Government wants to emphasise the need for the vehicle owner to take responsibility for having their car serviced and that will create some service opportunities.

He says the changes are likely to drive industry consolidation. In its acquisition Jevic is looking to grow its business, not expecting it to shrink.

Mr Philpot says the business model that VINZ has had for a number of years is a good one which does not rely on one particular inspection service.