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Japan Post Holdings to unload part of Toll Holdings for AU$7.8M

Japan Post Holdings to unload part of Toll Holdings for AU$7.8M
Japan Post Holdings to unload part of Toll Holdings for AU$7.8M

Japan Post Holdings has reportedly announced plans to sell part of Toll Holdings, an Australian logistics company, for a sum of AU$7.8 million. The stake will be sold to an Australian investment fund, absorbing a tremendous loss in the transaction.

According to reliable sources, the deal marks the most recent chapter in the company’s troubled ownership of Toll. Japan Post Holdings had acquired Toll in the year 2015 for a value of 620 billion yen in hopes of securing international logistics know-how for fresh growth.

The present transaction will force Japan Post, which is majority owned by the government, to take its international strategy into reconsideration.

For the record, Toll incurred an operating loss of AU$10 million for a period of nine months through December. This was mainly due to losses in the Australia-focused segment which is now being sold. The operating loss of the segment reached a valuation of AU$83 million, extending by AU$25 million from a year earlier.

By selling the logistics and home delivery operations of Toll in New Zealand and Australia to Allegro Funds, Japan Post is set to assume several billion dollars of debt. The company will also log an extraordinary loss of nearly 67.4 billion yen or roughly a sum of $624 million for the fiscal year that ended in March 2021.

As per John Mullen, Toll Chairman, the divestment shows consistency with Toll’s strategy of focusing on being a preeminent logistics provider in the APAC via its core businesses in the areas of freight forwarding and contract logistics.

It is to be noted that Japan Post does not anticipate that the sale will have a major effect on its net surplus. The company believes that a major part of the loss will be balanced by over 60bn yen in tax reductions, which is the implication of other factors.

As per records, Japan Post has selected JPMorgan Securities Japan and Nomura Securities as advisers for the transaction. The company had started the process of selecting buyers in the month of November 2020.

Source credit: https://asia.nikkei.com/Business/Business-deals/Japan-Post-to-sell-part-of-Australia-s-Toll-booking-624m-loss

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Nandita holds a management degree with specialization in marketing, and boasts of a short-term experience in the field of recruitment. Following her passion for writing however, she decided to pursue a career in the field of content development. Presently, Nandita pens down news pieces for newsorigins.com, spanning the verticals of business, finance, and technology.