Singapore Post Limited (SingPost) announced on Thursday it has completed the divestment of its Australian logistics arm, Freight Management Holdings (FMH), to Pacific Equity Partners (PEP) for an enterprise value of A$1.02 billion (S$867 million).
The sale marks a significant milestone in SingPost’s ongoing strategic review, aimed at unlocking shareholder value. The transaction was approved overwhelmingly by shareholders, with 99% voting in favor at an extraordinary general meeting on March 13.
Following a competitive international bidding process, the divestment generated gross proceeds of approximately A$781.5 million (S$664.2 million) and an expected gain of around S$289.5 million. This preliminary figure will be finalized upon completion of the annual audit and detailed in SingPost’s full-year results for fiscal 2024/25.
SingPost noted that the sale represents a levered return on equity of approximately four times its original equity investment of A$93.6 million in FMH over the past four years.
Proceeds from the divestment will primarily be used to reduce the company’s debt, including repayment of borrowings totaling A$362.1 million (S$307.8 million) related to the initial acquisition of FMH. SingPost also stated that details regarding the distribution of a special dividend to shareholders will be disclosed in line with SGX-ST listing rules.
The company now faces a strategic reset, with its interim earnings driven by the core Singapore Postal and eCommerce Logistics business, its international eCommerce operations, and two major non-core assets—SingPost Centre and Famous Holdings—which continue to perform robustly.
SingPost indicated the successful divestment, alongside potential future asset sales, will generate substantial liquidity, allowing the company flexibility to reinvest strategically, further reduce debt, or return capital to shareholders in alignment with shareholder interests.
Business News Asia
