HSF, G+T advise on trans-Tasman logistics deal

The complex transaction involved a landmark acquisition for a transformation and turnaround PE firm

HSF, G+T advise on trans-Tasman logistics deal

Herbert Smith Freehills (HSF) and Gilbert + Tobin (G+T) have advised on a trans-Tasman logistics deal involving a landmark acquisition by transformation and turnaround PE firm Allegro Funds.

Allegro purchased Toll Global Express, the express parcel, freight delivery and domestic forwarding arm of major Australian transportation and logistics company Toll Group, from Toll Group and parent company Japan Post. The acquisition included two cargo ships, related plant and equipment, and real property leases, according to G+T.

HSF guided Allegro, while G+T assisted the Commonwealth Bank of Australia (CBA), which was among the organisations helping to finance the deal. The acquisition was completed on 31 August.

HSF co-lead partner Paul Apáthy said that the deal “demonstrated the strengths of Allegro’s market leading transformation and turnaround team.” Meanwhile, co-lead partner Andrew Rich highlighted the complicated nature of the acquisition.

“The challenges typically present in a transaction of this size were further compounded by the fact that logistics companies, such as the Toll Global Express business, are inherently complex,” Rich explained.

Allegro funded the acquisition with its own funds in combination with debt backed by CBA, Scottish Pacific and Gordon Brothers. A total of $500m was applied to complete Toll Global Express’ separation and transformation, HSF said. 

“Allegro believes that Toll Global Express has a critical role to play as an e-commerce enabler and will benefit from the increase in online transactions since the emergence of COVID-19,” HSF and G+T said. “The continued growth in online commerce requires robust logistics networks for delivery and fulfilment. Allegro plans to ensure Toll Global Express is positioned to maximise this opportunity.”

Following the sale, Allegro co-founder and managing director Adrian Loader will serve as chair of Toll Global Express. Ex-Australia Post chief executive Christine Holgate will act as group CEO.

HSF advised Allegro with regard to detailed diligence acquisition structuring, multiple financing arrangements, IT, logistics, insurance, employment, shipping and transitional matters. The firm also helped to negotiate and complete the sale agreements.

Apáthy and Rich led a massive team composed of experts across a variety of practice areas alongside fellow partners Nikki Smythe and Steven Catanzariti. They received support from partners Calvin Ho, Kwok Tang, Drew Pearson, Damien Hazard, David Hugo, Kristin Stammer and Leon Chung; executive counsel Josie Essery and Amy Repse; special counsel Nerida Jessup; senior associates Lauren Jeffries, Caitlin Walker, Joshua Santilli, Kimberley Lean, William Chew, Tess Mierendorff, George Psaltis, Lucinda Grant, Jie Li, Rommo Pandit, Kara Reynolds, Sophie Beaman, Graeme Tanner; and solicitors Ting Fan, Caroline Talbert, Darran Devlin, Thomas Gooch, Joel McDonald, Annabel McCullagh, Henry Meehan, Fiona Poh, Gemma Pastellas, Angela Taraborrelli, Nikhil Mishra, Angie Wong; and graduates Mitchell Brunker and Crusoe Flynn-Pittar.

Meanwhile, G+T guided CBA on structuring and documenting the deal. The team also helped to negotiate and settled the necessary finance documents.

Banking partner John Schembri was at the helm, supported by special counsel Caroline Mathie and lawyers James Lee, Shauna Mainprize, Cinzia Tisano and Logan O’Brien.

“We were pleased to advise CBA on this financing, which showcased CBA’s deep understanding of this sector and particularly its expertise in the financing of unique asset classes such as vessels and supply chain infrastructure,” Schembri said.

Allegro also received advice from KPMG, Macquarie Capital, Skye Capital, McGrathNicol and Faraday Associates. MinterEllisonRuddWatts provided input on the New Zealand aspects of the deal.

Meanwhile, Toll Group tapped Ashurst, Deloitte, Nomura and JP Morgan for advice, with Bell Gully advising on the New Zealand aspects.

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