Chinese company HNA International has terminated its agreement to acquire Automotive Holdings Group’s refrigerated logistics business
CHINESE COMPANY HNA
INTERNATIONAL has terminated its agreement to acquire Automotive Holdings Group’s (AHG) refrigerated logistics business, the Australian company has announced.
The decision comes after AHG announced in June that it would not meet the original deadline for the $400 million deal for the sale of its Rand, JAT, Harris and Scott’s Refrigerated Freightways businesses.
AHG said at the time that it was still waiting on approval from the Foreign Investment Review Board (FIRB), but added that HNA had also asked it to alter the terms of the deal. AHG managing director John McConnell says while he is “disappointed with this outcome”, it would now allow the Refrigerated Logistics management team to focus fully on running the business.
“HNA made an unsolicited offer for the Refrigerated Logistics division last year and we engaged with HNA,” he says.
“Unfortunately since that approach HNA has run into liquidity problems, which combined with the delayed FIRB process left the conditions precedent unable to be satisfied within an agreed timeframe.”
“The intent was always to complete the investment phase of the transformation program and create optionality regarding the future for Refrigerated Logistics and we will maintain our focus on that.”
The refrigerated logistics division recorded a net profit of $780,000 during the first half of the 2017-18 financial year, up from a loss of $2.2 million in the previous corresponding period, on the back of $291.3 million in revenue. Yet the company said in May that its second-half trading had been impacted by the sale process and its relatively long lead time to completion.