Owner may put Loscam back on the sale block

Loscam provides poolable and returnable packaging solutions for supply chains. Picture: Dan Peled

Pallet pooling company Loscam could be returning for another attempt at a sale sooner rather than later.

According to sources, the management of the logistics company was out testing buyer interest late last year, creating expectations it could make attempts to sell the business once again. It is believed the company considered a move early last year before market conditions saw it hit pause on the plan.

Loscam’s owner is China Merchants, which placed the business up for sale in July, but only the Australia and New Zealand operations were on offer and bids came in below its expectations.

Last year, the plan was to include the Southeast Asia division which has been more highly sought after by prospective buyers.

Pallets are not as widely used in Southeast Asia which creates an opportunity for an acquirer to grow earnings there.

One of the private equity firms showing earlier interest in the Southeast Asian operations was CVC.

When the Australian and New Zealand arm was for sale last time, it was understood to have been generating about $100m of annual earnings before interest, tax, depreciation and amortisation, and it is believed that the asking price was close to the $2bn mark. A deal including the Southeast Asian operation would make it far more valuable.

When a sale process was up and running for the Australian and NZ business in 2022 through Goldman Sachs and UBS, Queensland Investment Corp, Brookfield and Pacific Equities Partners were all interested buyers, as was Igneo.

The company describes itself as a trusted name in pooling and returnable packaging solutions for supply chains.

China Merchants purchased the business in 2010 for $US650m in a deal involving Credit Suisse and Deutsche Bank, and in 2018 it sold down a 55 per cent interest to CITIC Capital Partners and FountainVest.

Infrastructure groups that may be keen are Morgan Stanley Infrastructure Partners, Stonepeak, Morrison & Co, Kohlberg Kravis Roberts, CDPQ and EQT. Should a sale process prove successful, it could pave the way for further asset sales by private equity firms.