The dealmakers that advised on the Allegro | Toll Group deal
Australian private equity outfit Allegro Funds has acquired the express division of Toll Group, leaving the country’s largest third-party logistics operator with its forwarding and contract logistics operations.
The deal was supported on both sides by a cohort of M&A advisors from professional services groups. Buyer Allegro was advised by McGrathNicol, KPMG, Macquarie Capital, Skye Capital, and law firms Herbert Smith Freehills and Minter Ellison Rudd Watts. At the other end of the table, seller Toll Group was advised by Deloitte, Nomura, JP Morgan, and law firms Ashurst and Bell Gully.
Terms of the transaction were officially undisclosed, although figures from Loadstar Premium peg the deal at $10 million. Official statements expect a 30 June 2021 completion date on the acquisition, and Toll Group Express’ daily operations will remain unchanged in the interim.
Toll Group is a 125-year-old global logistics giant headquartered in Melbourne, with an offering of freight transportation across mediums; customs support; warehousing & distribution; and fleet management – among several other services. Also in the mix is express delivery to consumers worldwide – a business that has now changed hands to Allegro.
The deal raises much-needed liquidity for Toll Group, which has reportedly been struggling with profits. Chairman at the group John Mullen described the sale as “ an exciting opportunity to build a profitable, sustainable company for the long term by re-orienting around its key strengths and competitive advantage.”
For Allegro – a fund that specialises in transformation and turnaround investments – the deal buys control of a key player in one of the most important economic segments of the new normal. With most consumer activity moving online during the pandemic – expected to stay that way even after – express delivery will become a differentiating factor in a booming and highly competitive ecommerce landscape.
Allegro has managed to raise $500 million to grow Toll Group’s express delivery business through a digital transformation programme. “The business has high-quality assets, is number one or two in its core market segments and will be supported by strong local management,” said Allegro co-founder Adrian Loader, who takes over as chairman of Toll Group Express.
“It was fantastic to support Allegro with this acquisition, which positions them to take what is already a market leading operation, to another level,” said McGrathNicol partner Shaun Fraser, who led the firm’s deal advisory team alongside fellow partners Rhyan Stephens, Rob Smith and Conor McElhinney.
