05.04.2007

Neff sold

Miami based Neff corp the eighth largest rental company in North America has changed hands for the second time in less than two years as another private equity company moves out of the rental sector.

Odyssey Investment partners has sold the business for an undisclosed sum to Lightyear Capital, which will acquire Neff through its ‘Lightyear Fund II’.

Odyssey acquired Neff in June 2005 in a deal worth over $500 million, it paid shareholders $240 million for the equity with the balance of the deal being assumed debt, which was refinanced after closing.

The sale to Lightyear is expected to close before the end of June.

The details of this latest transaction have not been revealed, Neff has not expanded the number of outlets it operate from since 2005 - (66) – but it has increased its fleet from 10,500 pieces of equipment to over 12,000 and has almost certainly benefited from the strong rental market.

Lightyear Fund II includes General Electric Pension Trust and Norwest Equity Partners. Neff’s existing management team, which maintained a stake in the business in 2005, will also be investing in the transaction.

Bank of America, CIBC World Markets, GE Capital Markets and UBS Investment Bank will arrange the debt financing.

Upon closing of the transaction, current chief executive officer Juan Carlos Mas will become Chairman of Neff, while current president and chief operating officer Graham Hood will assume the role of president and CEO of Neff. Hood spent most of his career with Hertz equipment, including a spell in Europe in the late 80’s and early 90’s.

“Neff’s asset management core competency makes it an ideal fit within Lightyear’s portfolio as we continue our investment strategy of seeking leading companies within specialty growth areas of financial services,” said Donald B. Marron, chairman and chief executive officer of Lightyear.

“With its attractive geographic footprint, proven ability to deliver quality customer service to its clients, and highly regarded management team, Neff has been a consistent top performer and remains well positioned for future growth.”

Neff Rental traces its history back to two companies, MP Equipment, which was founded in 1988 by the Mas family and Jose Perez, a former Hertz executive, and Neff Machinery, a John Deere dealership based in South Florida. In 1989, Neff Machinery was purchased by the Mas family and merged with MP Equipment to create Neff Rental.