Mainfreight sells Owens' big earners

By PAM GRAHAM

Mainfreight has sold off businesses producing just under half of its subsidiary Owens Group's revenue and is making no apologies for it.

Mainfreight was blocked from a full takeover of Owens, a rival New Zealand transport operator, by Australia's Toll Holdings but it has control of the company and has been selling off non-core businesses.

Owens yesterday announced completion of previously signalled sales of its containers, Seatrans New Zealand and rural business.

Mainfreight managing director Don Braid said the sale of another container business and other tidying up was still proceeding.

The businesses left provided about $260 million of revenue from the $400 million before the sales.

"What we're left with are the two international divisions and the domestic freight division here in New Zealand, which are businesses we understand that we know how to add value to and are complementary to our supply chain strategy."

He denied that Mainfreight had broken up a New Zealand business.

"What we've done is brought back the great New Zealand business to what it was.

"It had got out of control. It did not understand what part of the transport industry it was really in.

"A customer of transport was not a customer of a shipping agency or container services division."

Braid said that in most cases staff had moved to the new owners and there were few redundancies.

Paul Little of Toll Holdings said his company would like to have more input into decisions being made but Mainfreight was not giving it the opportunity.

"The original intent was to try to participate in some of the synergies between Mainfreight, Owens and Tranz Rail.

"Those synergies are quite significant. The only way we felt we could participate was to take a stake in Owens. Mainfreight were not going to welcome us into the fold in any other way."

Little said he had had a long and good discussion with Mainfreight chairman Bruce Plested.

"There is an understanding of what both parties want but we can't reach an agreement on how to achieve it."

Owens sales

Seatrans, McArthur Shipping sold to McKay Shipping, price not disclosed.

Container Services sold to United Containers for $6.3m.

Rural Transport sold to Wareing Transport for $2.5m.

Australian International sold to Mainfreight, price not disclosed.

Cooltainer sold to Sea Containers Australia for $12.4m.