The Federal Court has dismissed the ACCC’s proceedings against rail companies Pacific National and Aurizon, which related to control of Acacia Ridge Terminal, a key asset in Australia’s intermodal rail network. Read more
Rail operator Aurizon has announced the closure of its intermodal business, following a tough financial year where the company posted a loss of $188 million. A consortium of Pacific National and Linfox will take over its Queensland facility, and Pacific National has purchased its Acacia Ridge terminal, with the transactions bringing in a total of $220 million. Aurizon’s remaining intermodal business, outside of Queensland, will be closed by December.
“The decision to exit Aurizon’s Intermodal business is in response to the continued losses in this business and market dynamics, with sale proceeds and future capital able to be recycled into other profitable parts of the company,” said Tim Poole, Chairman, Aurizon. “The exit will allow Aurizon to focus on creating shareholder value through its core strengths and capabilities of heavy rail haulage operations and rail infrastructure management.”
Andrew Harding, Managing Director and CEO at Aurizon, added: “Following the review of our Freight business, we have made the decision to exit Intermodal by closing down our interstate operations and selling Queensland Intermodal and Acacia Ridge terminal. Initiatives are in place to turn around the performance of our Bulk business following significant impairments in July.
“Going forward, we will leverage our operational and commercial capability in heavy haulage operations and rail infrastructure to create value and certainty for shareholders.”
In a message to employees, Harding explained the decision to close the company’s Intermodal division.
“Unfortunately, over the years we ave continued to see significant financial losses in this part of the business,” he said.
“The reality is that in a market serviced by a number of well established transport providers, we have been unsuccessful in establishing a significant scale and customer base to make it profitable.
“Exiting the Intermodal business is clearly not a decision we have taken lightly but one we had to make if we are to provide certainty and value for our shareholders.”