ANZ Terminals closes deal to acquire Graincorp bulk liquid terminals

The A$333m transaction includes six terminals across Australia, with a terminal at Port Kembla in NSW excluded due to competition concerns.

ANZ Terminals, an entity owned by a group of private infrastructure investors, has completed the acquisition of Graincorp’s Australian Bulk Liquid Terminals division.

The transaction closed on December 31, 2019, after the Australian Competition and Consumer Commission approved the sale in November. Graincorp’s Port Kembla Liquid Terminal in New South Wales was excluded due to potential competition concerns around port-side bulk liquid storage in the state.

As a result of the exclusion, the transaction value was reduced from the original agreed price of A$350 million ($245 million; €219 million) to A$333 million. The price also includes a deferred component of A$19 million, which will be paid subject to the satisfaction of milestones around the extension and commencement of lease agreements at certain terminals.

The deal includes six terminals: Coode Island and North Laverton in Victoria; Pinkenba in Queensland; Largs Bay in South Australia; Devonport in Tasmania; and Fremantle in Western Australia. Graincorp will retain ownership of its terminal at Port Kembla and its terminals in New Zealand.

ANZ Terminals has several infrastructure fund managers and institutional investors among its shareholders. Palisade Investment Partners manages a 32 percent equity stake in ANZ Terminals on behalf of its open-ended Diversified Infrastructure Trust and two unidentified direct mandates, according to a statement made upon acquiring the stake in November 2014.

First Sentier Investors also holds a stake in ANZ Terminals of around 23 percent via its Global Diversified Infrastructure Trust, while Canadian managers Northleaf Capital Partners and Fengate Capital are also known to be shareholders. All acquired their stakes from Macquarie Group in late 2014, with Macquarie Capital then retaining a stake of around 10 percent.

ANZ Terminals operated five terminals across Australia prior to the Graincorp deal: Port Botany in New South Wales; Geelong and Coode Island in Victoria; and, Pelican Point and Osborne in South Australia.

Graincorp said in a statement to shareholders that it would report a pre-tax profit of A$93 million on the sale at its half-year results for FY2020. This includes the impact of a long-term storage agreement signed with ANZ Terminals.

The ASX-listed firm announced late last year that its underlying EBITDA in FY19 had fallen to A$69 million from A$269 million in 2018. The company posted an underlying net loss after tax of A$82 million, down from a net profit of A$71 million in 2018, mainly due to ongoing drought conditions in much of eastern Australia.