Japan Post Holdings Co Ltd said on Wednesday it has agreed to sell part of Toll Holdings, its money-losing Australian logistics arm, for 700 million yen ($6.5 million).
The Japanese firm said in a statement it will sell Toll’s delivery services business in Australia and New Zealand to Australia’s Allegro Funds.
The deal, which is expected to close by end-June, comes after the two companies have said they would consider selling the loss-making delivery business hit by the coronavirus outbreak.
Japan Post Holdings also said it would book a one-off loss of 67.4 billion yen for the financial year ended March due to the sale.
The company bought Toll in 2015 for A$6.5 billion ($5.02 billion) to diversify overseas. It had to write down the bulk of Toll’s value two years later due to weak performance.
At an online press conference, Kazuhide Kinugawa, chief executive of Japan Post, said the company would make an effort to improve profitability at the rest of Toll’s businesses, but declined to elaborate further.
“We haven’t been offered at high price, as buyers became pessimistic due to the severe business environment,” Kinugawa added.
The sales price of 700 million yen compares to the book value of about 69 billion yen.
Source: Reuters.com