Payments to end transaction that became regulatory legal saga
The $205 million sale of Aurizon’s Acacia Ridge Terminal to Pacific National (PN) is now complete, the company states.
The announcement comes close to four years after the move first emerged publically and three years after the first regulatory hurdle emerged.
All conditions satisfied and outstanding funds transferred to Aurizon, which says it has already received a non-refundable payment of $35 million.
The balance of $170 million has been received today by Aurizon.
Tax payable on the sale is an estimated $40 million, resulting in net remaining proceeds of approximately $130 million.
“The contract became unconditional following approval of the transaction by the Foreign Investment Review Board in February 2021,” Aurizon says.
The High Court rejected an application by the Australian Competition and Consumer Commission (ACCC) In December that sought leave to appeal a decision by the Full Federal Court allowing the sale to proceed.
Read how PN reacted to the deal when it was first agreed, here
“This network helps provide Pacific National with the ability to deliver crucial daily rail freight services for Australian businesses and communities as they recover from the negative economic and social impacts of the Covid-19 crisis,” the rail firm said at the time.
“Pacific National is also actively working to ensure the many and varied benefits of
Australian rail freight are incorporated into our nation’s growing freight task, including helping to improve road safety, lower emissions, and reduce traffic congestion and truck ‘wear and tear’ on local and state roads.”
The ACCC had been concerned about the impact of the sale on the freight industry, noting that Pacific National and Aurizon are currently the only providers of intermodal rail linehaul services in Queensland.
“Aurizon’s decision to sell its Queensland intermodal operations and the Acacia Ridge Terminal to its closest competitor, while shutting down its remaining intermodal business, will fundamentally change this market,” ACCC chairman Rod Sims said.
“We are concerned the proposed acquisitions would lead to increased prices and reduced service for freight hauled between Brisbane and Far North Queensland.”
But the High Court accepted PN’s access undertaking to it and that this was enough protection.
The terminal sale completes Aurizon’s three-stage exit from its loss-making Intermodal business, comprising:
- Closure of the Interstate intermodal business (outside Queensland) complete in December 2017
- Sale of the Queensland Intermodal business to Linfox complete on January 31, 2019 ($7.3 million received by Aurizon)
- Sale of the Acacia Ridge Terminal.