A handful of Kiwi transport companies have recently changed hands – probably the biggest deal involving the buyout of Big Chill Distribution by Freightways.
Freightways announced to the New Zealand Stock Exchange in late October that it had entered into an agreement to buy 100% of Big Chill – for at least $117million.
In other deals, two long-standing Southland transport operations – Central Southland Freight, based in Winton, and Mataura's Tulloch Transport – have been sold…to Canterbury company Hilton Haulage and Invercargill-headquartered McNeill Distribution respectively.
In addition, Hawke's Bay company Tomoana Warehousing has been purchased by Palmerston North-based Booth's Transport.
Freightways says that Big Chill "is a NZ market leader in temperature-controlled transport, specialising in fast-moving consumer goods (FMCG) and time-critical parcel freight – both chilled and frozen.
"Big Chill operates a fleet of over 200 temperature-controlled trucks and trailers and delivered more than two million shipments in 2018 through its nationwide network of depots and purposebuilt coolstores."
In the announcement, Freightways CEO Mark Troughear said the purchase "represents a highly compelling transaction and will provide Freightways with both short and longterm growth opportunities, while further diversifying its earnings base.
"Big Chill's founders and senior management have done a fantastic job growing the business and we look forward to working together, recognising the strong cultural alignment between our two businesses."
The deal is subject to Overseas Investment Office approval, with completion of the purchase expected to occur in the first half of 2020.
Freightways said that an initial payment of $117m represents 80% of an agreed enterprise value (EV) for Big Chill. A final payment will be made in the second half of 2022, representing 20% of Big Chill's EV at June 30 that year.
Freightways, which has over 4000 employees and contractors and delivers 50 million items annually through the likes of its Post Haste Couriers and NZ Couriers, reported a net profit of $63.4m in the year to June 30, 2019.
In the other three deals it's reported that the companies acquired will continue to operate "as usual" – under their existing names and with their existing staff retained by the new owners.
Stuff reported that Inky Tulloch will continue to work with the new owners for a time in the business his father Mac founded in 1945, and Corey Price will remain with Central Southland Freight, while his parents, Garry and Helen will retire from the business they started 35 years ago.
Similarly, at Tomoana, founder Trevor Taylor (involved in road transport in Hawke's Bay for over 40 years) is retiring – while son Stewart "will remain at the helm" in a new executive director role and as interim GM.
In an announcement to customers, Trevor and Craig Booth and Stewart Taylor say that Booth's purchase of Tomoana "has come about from the desire to tackle some of the challenges in recent times head-on, as well as the retirement of Trevor Taylor."