Receivers weigh up task of selling off Scott’s assets

Scott’s is the largest refrigerated trucking company in Australia and it is a direct supplier to Coles and Aldi and delivers on behalf of vendors to Metcash IGA stores.

Receivers now have the job of selling off the assets of Scott’s Refrigerated Logistics after it was placed in liquidation on Friday.

The receiver for the business is KordaMentha, and a number of creditors had stopped working for Scott’s by the time it collapsed. This includes Pacific National among others.

There has been a suggestion customers were struggling to receive any communication in the final days.

It is expected that buyers will be found for its assets, but selling its fleet of 500-plus trucks and 1000-plus trailers in one line could be tricky because they are spread throughout the country.

On Friday before it collapsed there was chatter that Scott’s could be subject to a break up.

Yet there was a view that lenders could get their money back if all the assets were sold off.

DataRoom revealed on Friday that Allegro’s Toll Global had opted not to bid for the business, with Lindsay Australia and Linfox the only two parties believed to be left as serious contenders.

One market expert said for Anchorage Capital Partners to place the business into voluntary administration it must have taken the view that the value was materially below the debt.

Offers were received on Thursday for Scott’s, which fell into receivership a week ago. Insiders say Scott’s is a good business.

But troubling some suitors has been its large debt levels and also the age of its fleet.

Linfox, considered an opportunistic buyer with the largest trucking fleet in the country, sees a high quality fleet of primary importance.

Anchorage bought Scott’s from ASX-listed car dealer AP Eagers in mid-2020 for $75m as a turnaround opportunity.

It is understood that the loss making business has loans worth at least $100m.

Scott’s is the largest refrigerated trucking company in Australia and it is a direct supplier to Coles and Aldi and delivers on behalf of vendors to Metcash IGA stores. The transport industry is a low margin business as it is, but refrigerated logistics is even more so, and such companies are highly capital intensive.

Gordon Brothers is owed $70m while Scottish Pacific is also a lender.

Impacting Scott’s performance has been flooding, the pandemic and rising costs.

Anchorage also appointed McGrath Nicol as voluntary administrator.