Trade sale for Ausdoc trucker

By DANIEL RIORDAN transport writer

Freightways Express parent Ausdoc Group has decided on a trade sale for the company rather than a sharemarket float.

Ausdoc said yesterday that it had entered into exclusive negotiations with an unnamed party, one of several which had been conducting due diligence on the freight and courier company in the past few months.

The preferred buyer will conduct due diligence with a view to entering a binding sale agreement by May 29.

Any sale would need shareholder approval.

Australian Stock Exchange-listed Ausdoc in December put itself, its New Zealand subsidiary and its Australian subsidiaries up for sale - as a whole or in parts - after global investment bank Babcock & Brown threatened to take over Ausdoc and break it up.

In March, brokers were asked to value a float of Freightways as an alternative to a trade sale.

Although brokers said at the time that a float would be well-received, clearly Ausdoc is confident of getting a greater return through a trade sale.

Industry sources the Business Herald spoke to speculated that Australian companies such as Toll Holdings or TNT could be the buyer.

Ausdoc owns all of Freightways' ordinary shares, but about 1500 New Zealanders own listed preference shares.

Freightways has about 1000 full-time staff and uses about as many independent contractors.

Its main business units are NZ Couriers and Post Haste.

Last week, the company said profit in the nine months to March 31 had risen by 48 per cent to $9.7 million, reflecting increased parcel volume and falling costs.

Revenue was 4 per cent higher at $138 million.

Ausdoc said it was continuing discussions over the sale of its other subsidiaries, DX Express, Go Mail and AIM.