Oaktree looms as suitor for Toll’s Global Express

Management presentations are taking place for the sale of the Toll Express Unit

The hopes of Allegro Funds Management and Anchorage Capital Partners landing a deal to buy Toll’s $3.5 billion Global Express business appear to be fading, with two other parties said to be serious about buying the division.

Some are pointing to the Los Angeles-based fund Oaktree Capital Management as a serious contender for the operation.

Oaktree is owned by global private equity firm Brookfield, which had earlier been hovering around Toll.

Sources said that local Australian turnaround funds Allegro and Anchorage were fading in the contest. Also out is BGH Capital, along with Singapore Post.

However another major global turnaround business - such as Platinum Equity or Cerberus Capital Management - could be in the final mix.

A number of bids were received for the Toll business, but it is understood that most were for only parts of the company.

Anchorage and Allegro were understood to have put forward offers for the business in its entirety.

After first round offers were received on December 23, the competition is up to the phase where management presentations are held for the parties left in the contest.

Banks JPMorgan and Nomura are working on the sales process.

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

New Zealand operations also account for a small part of the business.

Toll’s preference is to sell the division in one line.

Toll was founded by Australian billionaire Paul Little and is now 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.