Rowsthorn seeks to set Rivet on course for future

By: Rob McKay


Main aim initially is to return operations to business as usual after McAleese dramas

Rowsthorn seeks to set Rivet on course for future
Mark Rowsthorn has had an ‘interesting few years’

 

Rivet MD Mark Rowsthorn will spend the next 120 days cementing the present and forging a future of the company.

The new, privately held, incarnation of McAleese retains most of its previous assets with the exception of parts of the Heavy Haulage & Lifting business in Mackay that was sold off during the voluntary administration (VA) process late last year, Rowsthorn confirms to ATN.

Rivet is an entirely new entity, with its own bank presence and balance sheet and with employees transferred across from the old firm.

It has three main divisions:

  • Rivet Mining Services, which has the Pilbara and Goldfields bulk haulage operations in Western Australia, along with operations in Rockhampton, Emerald, including some cranes, and Newcastle, which is predominantly cranes. There is also a Cloncurry quarrying and transport operation
  • Rivet Energy, essentially the old Cootes tanker business transporting petroleum and gas products and chemicals nationally, with the major customer being LPG provider Elgas. It also has aviation refuelling contracts at Tullamarine airport in Melbourne and at Adelaide airport, plus the aviation refuelling and manufacturing company Refuel Australia
  • A soon-to-be unveiled priority transport firm, based on the WA Freight Lines business and to be called Australian Road Express.

Though quite small, Refuel Australia, which was about the only arm not involved in the voluntary administration process, is on a firm footing and perhaps too valuable to give up at this stage.

"It has just won a major contract with the defence forces for manufacture of over 100 tankers for their operations," Rowsthorn says.

"That gives it a book of three years’ work and maintenance of those units ongoing.

"Arguably, it’s not specifically core but it’s a good-quality small business that we want to grow with."

Rivet is basically owned by the secured creditors and include Hong Kong asset funder SC Lowy, which was intimately involved in funding McAleese last year, international financial planning and investment house BlackRock, with a small part held by boutique investment and advisory firm Remagen Capital Partners.

Senior divisional leaders are still in place.

The mining arm is led by Gary Ireson, with Mark Anderson heading the energy operation and former Toll executive Mike Valkenburg looking after Australian Road Express.

Discontinued operations remain in voluntary administrator McGrathNicol’s hands for sale.

"The company’s now has a conservative capital structure and we will be using the proceeds of the existing sales, which is primarily the crane assets and surplus tankers, prime movers and transport equipment, to further decrease the debt in the business," Rowsthorn says.

His aim is to get as close to business as usual as possible after recent upheavals and get relationships on some sort of even keel.

"It was quite a challenging and stressful time, during the VA, although it did work pretty well for us," he adds.

"We’re reintroducing ourselves to our customers properly as Rivet, updating banking arrangements, speaking to key suppliers, looking at new business opportunities."

McAleese suppliers took a hit from its travails and talks with those and other sides of doing business are bound to be fraught.

"Those discussions are top of mind at the moment and, ongoing, we’ve got major parts buyers, fuel , that sort of things, creditors have been hit hard, equity wiped out, so it hasn’t been easy in that regard.

"We’re sitting down with our clients and working through what the revised balance sheet looks like and coming to an arrangements that give them more certainty going forward."

Internally, the company has a 120-day plan highlighting priorities to work through and allocating tasks.

"The fundamental thing now is for us to reduce that debt. We’ve got a target of getting down to zero over the next six to 12 months.

"We think that’s achievable.

"We’ve got some important contract rollovers to get through over the next 12 months.

"The key focus is to stabilise the business and redo our business plans and redo the whole group’s plans.

"With a new balance sheet, we think we’ve got fundamentally sound businesses and without exception pretty positive growth potential."

Reflecting on the journey of recent times, Rowsthorn says: "It’s been an interesting few years, that’s for sure – part of the territory, I suppose," adding that the business has an "opportunity to get ahead now".

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