AHG sells refrigerated logistics arm
Automotive Holdings Group says unsolicited approach came with the right price
AUTOMOTIVE HOLDINGS GROUP ( AHG) is in the process of selling its refrigerated logistics division to Chinese investment firm HNA Group ( International) for $ 400 million in cash and debt.
The sale involves ownership of Rand, Harris, Scott’s and JAT passing to HNA- owned firm CC Logistics ( Australia), with AHG gaining $ 280 million and HNA ultimately assuming $ 120 million in finance lease liabilities.
“HNAI has indicated a commitment to growing and continuing to invest in the refrigerated logistics sector, both internationally and in Australia,” AHG CEO and MD John McConnell says.
“As an experienced participant in the logistics sector, HNA will continue to deliver quality services to customers and we strongly believe that the business will have a very positive future under its new owners.”
AHG Logistics CEO Stephen Cleary will remain with the Refrigerated Logistics business as CEO and will be supported by the existing management team and employees of the business.
“AHG has previously announced it would explore all opportunities to maximise shareholder value from the Refrigerated Logistics business,” AHG chairman David Griffiths says.
“Although the restructuring initiatives are delivering a significantly improved financial performance, the sale provides AHG with the opportunity to realise a certain value for shareholders that reflects this continuing improvement.
“The sale also provides AHG with both the resources for further growth in our automotive operations and scope for capital management.”
Completion is slated for the first half of 2018, subject to regulatory approval.
This is the third high-profile HNA-related investment locally this year, with the Hong Konghead quartered firm with roots in Hainan Island having picked up 19 per cent in and an alliance partnership with Virgin Australia, and being involved in an eastern state office tower-focused real estate investment trust.
AHG’s assets are destined for HNA Modern Logistics, the operations of which include trailer services, air, land and sea equipment finance and leasing, along with other services Fleet Care ( not to be confused with Australian leasing firm Fleetcare), Fleet Protect, and Fleet Intelligence.
That HNA arm will gain a former AHG division that is showing the benefit of a sustained restructuring.
“As an experienced participant in the logistics sector, HNA will continue to deliver quality services”