Toll to separate infrastructure, supply chain businesses

Toll to separate infrastructure, supply chain businesses Toll to separate infrastructure, supply chain businesses
   Melbourne-based Toll Holdings Ltd., recent purchaser of Australian ports and airport operator Patrick Corp., plans to next year separate its transport infrastructure assets from its network and supply chain business to create two Australia Stock Exchange-listed companies, Toll Holdings and Infrastructure Co.
   'The restructure should be seen as the next generation of growth for both companies by allowing each business to expand faster into global markets, through strategic acquisitions and rapid organic growth,' said Toll Managing Director Paul Little 'It will also offer investors a clear choice of investment, designed to maximize growth potential with an overall lower cost of capital and improved flexibility.'
   The proposal for the restructure will be put to shareholders for approval during the first half of 2007. Toll said its shareholders would retain their existing shareholding in Toll Holdings and receive, for each share held, a stapled security comprising one new share and one new unit in Infrastructure Co.
   If successful, each company will have its own management team and boards of directors. Little will retain his position at Toll while its current executive director, Mark Rowsthorn, will become the chief executive officer of Infrastructure Co., which will own Patrick and also Pacific National, it hopes.
   Toll has sought a waiver of the requirement to sell half of railroad Pacific National, which the Australian Competition and Consumer Commission made a stipulation of in agreeing to the takeover of Patrick, which jointly owned the rail network with Toll.
   Toll has also sought a waiver of its obligations to make available the East West Rail Assets, divestment of the Vehicle Transport Business and Prixcar interest, and to comply with certain non-discrimination obligations in relation to the operation of Pacific National and Patrick’s container terminals.
   It has also sought a variation in relation to the current undertakings to facilitate the sale of the Victorian Below Rail Network Assets to the State of Victoria for about A$134 million ($105 million), agreed in-principle Oct. 31.
   The ACCC is inviting comments from interested parties in relation to the proposed variation. 'The ACCC has not yet formed a view in relation to the proposed variation, and will make its decision following market inquiries,' said ACCC Chairman, Graeme Samuel. 'In particular, if market inquiries do not raise any issues of concern to the ACCC in relation to Toll's obligation to divest a 50 percent interest in Pacific National, the ACCC would look favorably on such a waiver.
   'While assessing this application, the ACCC is very concerned to ensure that the process currently under way to make available the East-West Rail Assets is not delayed or disrupted.
   'Toll is still obliged to continue the process to make available the East-West Rail Assets in accordance with the timeframes set out in the current undertaking while market inquiries are being made in relation to this matter. Only if market inquiries satisfy the ACCC that the obligations to make these assets available ought to be waived, will the ACCC agree to do so,' Samuel said.