Toll gets control of Patrick

Toll gets control of Patrick    Days after thwarting a potential last-minute rival bid from a consortium headed by Macquarie Bank, Toll Holdings Ltd. has gained overall control of Australian ports and airport operator Patrick Corp.
   Patrick’s board finally agreed to Toll’s hostile A$5.8 billion ($4.5 billion) cash-and-share takeover bid in April, after eight months of arguments and threats. Toll now owns 52.27 percent of Patrick, whose board of directors resigned today under the terms of their offer acceptance agreement.
   Toll’s Managing Director Paul Little is the new chairman of Patrick. Fellow Toll executives Mark Rowsthorn and Neil Chatfield have been appointed as Patrick’s executive director and chief financial officer, respectively.
   Patrick is Australia’s largest terminal operator and stevedore, and provides freight forwarding, customs brokerage and other services for importers and exporters. It also provides passenger and cargo ground handling at Australian airports, as well as road feeder services, and has majority control of Virgin Blue, the low-cost Australian airline started in cooperation with Virgin Atlantic founder Richard Branson.
   Toll plans to become an elite integrated logistics providers, and hopes to gain synergies from Patrick and another recent acquisition, Singapore-based logistics giant SembLog, for which it paid A$1.1 billion ($847 million).
   “This merger is a winning combination for shareholders and customers, with forecast revenues for the merged group of A$8 billion ($6.2 billion) and total assets of A$11 billion ($8.5 billion),” Little said.
   “We will act swiftly to achieve Toll’s long-held ambition to create a leading, global scale logistics business focusing on Australia and Asia, with operations in 17 countries.
   “Toll now urges remaining Patrick shareholders to accept our offer and participate in the enhanced value that can be delivered through the combined business,” Little said. Toll’s offer of A$3 ($2.31) cash, plus 0.4 Toll shares for each Patrick share held, is scheduled to close Friday.
   Toll said it has already set up integration teams, and over the next week will review Patrick’s operations before announcing an interim management structure at the company.
   Toll will also appoint an asset sales team to handle the sale of its half of the Pacific National freight railway, which it co-owns with Patrick. The Australian Competition and Consumer Commission made Toll’s divestment of the railway a stipulation of its agreeing to the takeover of Patrick.
   “It will be business as usual for both Toll and Patrick until our review is completed, which we expect will take a number of months,” Little said.
   Before handing over control to Toll, Patrick’s former board today reported a net profit of A$118 million ($91 million) in the first half of its fiscal year 2006, up 8 percent over A$109 million in the same period in the 2005 fiscal year. Revenue was up 17 percent to A$1.69 billion ($1.3 billion) from A$1.45 billion.
   “The fact that the Patrick business is in such good shape confirms Toll’s strategic objective to secure these assets with strong operational management,” Little said.