Funds wary of full Express bid

Toll Holdings chief executive Michael Byrne speaking at an American Australia chamber of commerce luncheon in Melbourne in 2018. Aaron Francis/The Australian

Private equity firms BGH Capital and Pacific Equity Partners are unlikely to submit an offer for the entire $3.5bn Toll Holdings Express division, according to market sources.

Bids are due on Wednesday and the two buyout funds were expected to enter the contest with Anchorage Capital Partners.

JPMorgan and Nomura are working on the sale process.

The understanding is that the Express division consists of three components, including Express Parcels, the Toll freight shipping operations across the Bass Strait to Tasmania and an intermodal operation.

It is understood Toll’s preference is to sell the division in one line, but a break-up may be its only chance of a sale if buyer interest is scarce.

Toll was founded by Australian billionaire Paul Little and is owned by Japan Post, which outlaid $6.5bn for the operation in 2015.

Japan Post booked a shock $4.8bn writedown on Toll two years later. It has since invested $2bn in Toll.

While COVID-19 has meant online trade has been booming, Global Express has suffered from volatility and cyber-attacks. It lost $100m in the June quarter.