SingPost to Sell Australian Business in A$1.0 Billion Deal

Dow Jones12-02

By Amanda Lee

Singapore Post is selling its Australian business to a private-equity firm in a deal valued at over US$650 million, including debt, as part of a strategic review and will consider paying out a special dividend.

The Singapore-listed postal and e-commerce logistics provider has entered into a share-purchase agreement to sell Freight Management Holdings to Australia-based Pacific Equity Partners at an enterprise value of 1 billion Australian dollars, equivalent to US$651.2 million, it said Monday.

SingPost stands to pocket 775.9 million Australian dollars in cash and expected disposal gains of about 312.1 million Singapore dollars, equivalent to US$233 million, from the deal.

The postal company's board believes the sale will unlock value for shareholders and "crystallize" the business's unrealized value, said chairman Simon Israel.

SingPost intends to use some of the proceeds from the deal to repay borrowings, in particular, Australian dollar-denominated debt. It will consider a special dividend after factoring in the debt repayments and the group's future funding needs.

SingPost's Australian dollar-denominated debt stood at 614.8 million Australian dollars as of end-September.

The proposal comes after the Singaporean company announced a strategic review of its Australian operations earlier this year in part to boost shareholder returns.

SingPost said it had received unsolicited interest in FMH, and evaluated options including full and partial divestments before determining that a full sale was the best strategy.

"Once the transaction is complete, the board and management will review and reset the group's strategic plan, with a continued focus on shareholder value," said Vincent Phang, group CEO at SingPost.

The deal is subject to regulatory and shareholder approval, and SingPost will announce its strategy reset and special dividend decision when appropriate.

Write to Amanda Lee at amanda.lee@wsj.com

(END) Dow Jones Newswires

December 01, 2024 23:50 ET (04:50 GMT)

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SingPost to Sell Australian Business in A$1.0 Billion Deal

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