Singapore Post Limited’s (SingPost) five-year affiliation with Freight Management Holdings is officially over. After initially taking the first steps to acquire 100 per cent of the company all the way back in 2020, the sale of FMH to Pacific Equity Partners (PEP) has now been signed, sealed and delivered.
The sale of FMH has returned the company to Australian hands through the private equity firm’s acquisition. Officially, gears started turning on $1.02 billion sale in December 2024, and SingPost’s strategic pivot in its operations fostered a range of unsolicited international bids that forced SingPost into a decision.
Hold, partially divest, or fully divest. It chose the latter.
SingPost commenced a strategic review of its entire portfolio of businesses in July 2023. In March 2024 it commenced a further strategic review of its Australia business, during which it received said unsolicited interest in the acquisition of FMH.
Now, 12 months later following the company’s has determination that full divestment was its best option, one of the largest segments of SingPost’s overall operations is now out of its hands.
But how did we get here?
Who is FMH?
FMH consists of nine of Australia’s leading transport and logistics firms that, between them, cover almost every aspect of supply chain logistics.
- efm Logistics is Australia’s largest 4PL provider and offers over 78,000 sqm of warehousing space across the country.
- FLIP covers FMH’s logistics software development, and its platform is use by efm and other customers.
- CouriersPlease and its 800-plus franchise partners engage in B2C parcel delivery and is the most recent merger/acquisition under the FMH banner.
- BorderExpress offers metropolitan and regional solutions within the FMH transport network.
- BagTrans specialises in LTL express pallet carrying services, mainly in the fast-moving consumer goods of grocery, retail and pharmacy distribution centres.
- Niche Logistics offers interstate and local transport between capital and regional cities for FTL and LTL services.
- GKR Transport offers general freight transport capacities in the East-West-East lane.
- Formby Logistics specialises in Tasmanian onforwarding services and commercial furniture freight to Tasmania and Western Australia
- Spectrum Transport is a specialist carrier providing B2B metro distribution in Brisbane, Sydney and Melbourne with a focus on fast-moving consumer goods.
Who is SingPost?
Singapore Post Limited, also known as SingPost, is Singapore’s designated public postal licensee, much like Australia Post is for Australia.
In addition to its handling of Singapore’s local and international postal requirements though, it also manages a network of warehousing and logistics portfolios across the world.
Now it services over 220 global destinations and has over 4900 employs in its 14 global offices.
Prior to its divestment in FMH it had been split into three major segments – Singapore, International and Australia.
Who is PEP?
Pacific Equity Partners is an Australian-based private markets fund manager that currently holds over $14 billion of assets under management.
It has operated in Australia and New Zealand since its foundation in 1998 and, prior to the acquisition of FMH, has completed transactions at a total enterprise value of $49 billion.
It has delivered a 28 per cent average Net IRR per annum across the closed end funds and was most recently awarded ‘2024 Firm of the Year’ from the Australian Investment Council.
The timeline
Singpost embarked on its vision to acquire an Australian business unit back in 2020, when it initially purchased 28 per cent of FMH for $85 million.
An additional 23 per cent of FMH was acquired by SingPost in 2021 for a further $112 million in 2021, which positioned it as FMH’s largest and majority shareholder.
It then further boosted its stake to 88 per cent at a further cost of $175 million in 2022, and then to 98 per cent in 2023. The final two per cent stake was acquired from FMH management shareholders in December 2023.
Once SingPost had control over 100 per cent of FMH shares, it went about expanding its Australian venture.
Border Express was acquired in early 2024, where the finalisation of the conditional sale and purchase agreement was reached on March 1. The acquisition boosted FMH Group’s expected revenue to over an estimated $1.3 billion annually.
A merger with sister company CouriersPlease followed later that year and came into effect on June 27.
The completed merger and acquisition of Border Express and CouriersPlease positioned FMH as one of Australia’s top five logistics companies, with over 3000 employees and franchise partners operating across 80 facilities and servicing 4900 customers nationwide according to 2023-24 projections.
SingPost’s control over one of Australia’s major logistics players would not last long though, as strategic reviews pivoted SingPost’s focus away from Australia and into its Singaporean and other international enterprises.
The further expansion of FMH and SingPost’s other international holdings saw the company split into three key business units following a strategic review, with the news released on March 19, 2024.
The units of ‘Singapore’, ‘Australia’ and ‘International’ would look after their own respective markets after financial documents revealed revenue generated overseas contributed to over 85 per cent of group revenue and operative profit.
Just nine months later though, three key executives had their employment terminated by the company for what was described as “grossly negligent” behaviour amidst an already turbulent sales process regarding FMH.
Group CEO Vincent Phang, Group CFO Vincent Yik and International Business Unit CEO Li Yu were all terminated and have all sought to contest the terminations through labelling them unfair and without merit.
Former FMH CFO Isaac Mah returned to Singapore to take over from Yik after overseeing the sale of FMH to PEP.
The announcement of SingPost’s intention to sell FMH to PEP at a total equity value of $1.02 billion was announced on December 3, 2024 – mere weeks before the trio of high-profile departures in the boardroom, with an Extraordinary General Meeting regarding the sale called for March 13, 2024.
The results of the EGM landed heavily in favour of the divestment in FMH, with 99 per cent of SingPost shareholders electing to approve the sale to PEP.
Chairman of SingPost Simon Israel labelled the decision to sell as the “best option for shareholders” to “crystallise the unrealised value of the business” and to “bring forward unlocking value for the shareholders”.
Some of the proceeds from the sale are intended to be used to repay borrowings, in particular SingPost’s Australian dollar-denominated debt amounting to $362.1 million (as at September 30 2024) undertaken for the financing of the acquisition of FMH.
PEP has now become the majority shareholder in the business and is joined by two private investors – Damian Degenhardt and Paul Little AO.
Degenhardt’s investment marks a return to the business. As Founder of efm Logistics he remained on the FMH board as Executive Chairman until the FMH was officially acquired by SingPost in 2021.
Little is former Managing Director of Toll Holdings, and in his tenure he oversaw over 100 acquisitions which helped boom global revenue to $16 billion. He will now chair the board.
FMH CEO Simon Slagter will remain in his longstanding position.
FMH and PEP have both released statements since the completion of the sale, with both businesses bullish at the prospect of continuing to grow FMH’s scope and capacity within the broader Australian transport and logistics market.
“We have built a business defined by innovation and the pursuit of excellence, earning the trust of our customers and partners. Now, with the backing of PEP and our other investors, we are poised for our next phase of growth. Their support will enable us to deepen our investment in proprietary technology, expand our business development function and pursue strategic acquisitions, while we remain committed to unlocking even greater value for our customers and continuing to deliver an outstanding customer experience,” Slagter said upon the sale.
We are delighted to officially welcome FMH Group to our portfolio. With 27 years of experience supporting Australian businesses to reach their full potential, we’re excited to partner with FMH Group in their next phase. Their ability to scale at pace while maintaining a strong customer focus is a testament to their leadership and team culture. We look forward to working together to unlock new opportunities to build on their impressive momentum,” PEP Managing Director David Brown said.
“As incoming Chairman, I bring the insights and experience gained from leading a logistics business through a period of extraordinary growth. FMH Group’s rapid ascent is a testament to their vision, strategic investment in technology and relentless pursuit of excellence. While I draw on past success, my focus going forward is on supporting FMH Group to continue to lead in a rapidly evolving landscape,” Paul Little said.
SingPost also released a statement regarding the sale and its expected positive impact on its shareholders.
“SingPost has indicated it will allocate the sale proceeds towards reducing debt, including the repayment of A$362.1 million (S$307.8 million) in borrowings related to the FMH acquisition. Additionally, the Board will in due course disclose the amount of the Special Dividend in compliance with the SGX-ST listing rules,” a company statement reads.
“The sale necessitates a strategy reset for the Group, with earnings in the interim dependent on SingPost’s Singapore Postal / eCommerce Logistics business, the International eCommerce Logistics business and two major non-core assets – the SingPost Centre and Famous Holdings – both of which have been performing well.
“The successful divestment of the Australia business, along with potential future divestitures, will create a significant cash pool. This will allow SingPost to reinvest in its future, reduce debt, or return proceeds to shareholders, with the Board ensuring these options align with shareholder interests.”
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