Aurizon has signed an agreement with Macquarie Asset Management to acquire One Rail Australia (ORA) for $2.35 billion.
ORA comprises bulk rail haulage and general freight assets in South Australia and the Northern Territory; the 2200km Tarcoola-to-Darwin railway line; and a haulage business in NSW and Queensland.
Aurizon will divest ORA’s NSW and Qld business (East Coast Rail) through a demerger or a trade sale, whichever creates greater value for Aurizon shareholders.
Aurizon will retain and integrate the ORA bulk and general freight assets into the Aurizon business. These include the Tarcoola-to-Darwin rail infrastructure, South Australian regional infrastructure, five rail yards, 68 active locomotives, over 1000 active wagons and approximately 400 employees.
The purchase is subject to several customary conditions precedent and regulatory and consent conditions, including clearance from the Australian Competition and Consumer Commission (ACCC). The acquisition is fully funded from a combination of Aurizon’s existing debt facilities and underwritten by new committed debt facilities.
Managing Director Andrew Harding said the transaction offered a unique opportunity to grow Aurizon’s business and create value for shareholders.
“The One Rail acquisition is highly strategic and transformative for Aurizon. It is fully aligned with Aurizon’s strategy to grow our Bulk freight business into new markets and new geographies in Australia,” he said.
“The One Rail acquisition delivers a step change for Aurizon Bulk as a new entrant in the SA and NT region, and supports the ongoing growth of non-coal revenue in the Aurizon portfolio.
“The ORA bulk infrastructure and operations in SA and NT provide customers with a safe, efficient and effective pathway to market for numerous existing commodities and growth opportunities in base metals, agriculture, iron ore and for new economy metals such as manganese and copper.”