The auction process for Scott’s Refrigerated Logistics is reported to be in overdrive right now.
On Monday it was announced that Scott’s Refrigerated Logistics entered voluntary administration and investment firm, KordaMentha, was tasked with finding a new owner for the business.
Australian Financial Review speculates major transport and logistics players including Toll, Linfox and Lindsay Australia might place their bids today.
In addition to its fleet of heavy vehicles, Scott’s also has a significant warehouse portfolio.
It is possible that the business in voluntary administration might see its warehousing sold separately from its other infrastructure and heavy vehicle assets.
Rather than striving for one sole owner, the business, under the direction of KordaMentha, could be divided among multiple parties.
The sale included the Rand, Harris, Scott’s and JAT businesses.
It is understood as part of this 2020 deal the Scott’s Refrigerated Logistics business was purchased for $75 million.
“Scott’s Refrigerated Logistics going into voluntary administration is sad but tangible evidence of the challenges facing the freight and logistics industry,” the Victorian Transport Association said in a statement.
“It should be a wake-up call for state and federal governments that freight operators have reached a tipping point due to higher fuel, infrastructure, labour, and other business costs, and that if genuine relief isn’t provided, other operators could suffer a similar fate.
“The VTA is very concerned about the impact of this announcement from Scott’s on its hardworking staff, but we remain confident and hopeful a long-term solution will emerge for what has been a very viable and successful business, with a solid customer base.”
Last week, the Transport Workers Union (TWU) said the collapse of Scott’s Refrigerated Logistics is a tragedy of a supply chain crisis caused by wealthy clients squeezing transport contracts and profiting off the razor-thin margins of operators.
TWU National Secretary, Michael Kaine, said Scott’s liquidation is a distressing warning that more businesses and lives would be at risk without action.
“Scott’s Refrigerated Logistics is a major casualty of an industry-wide crisis that’s pushing operators and drivers to the brink, which will have an enormous impact on our essential grocery supply chains.
“We’ll be doing as much as we can to make sure workers receive their owed entitlements, and have already begun work to find redeployment opportunities with other operators where possible.”
Eagers Automotive said Scott’s Refrigerated Logistics will wind down and cease its operations in a statement dated 6 March 2023
“Eagers Automotive is continuing to evaluate the impact on its sublease arrangements with Scott’s RL,” said Eagers Automotive.
“Current feedback indicates the facilities occupied by Scott’s RL are well-located and in-demand by industrial tenants.”
Scott’s Refrigerated Logistics was divested by Eagers Automotive on 30 June 2020 as it was regarded as a non-core business of the Eagers Automotive Group.
Eagers Automotive is reported to hold a $15 million non-cash provision in relation to the group’s property lease portfolio which includes subleases between Eagers Automotive (as sublessor) and Scott’s Refrigerated Logistics (as sublessee).
