After the repayment of A$614.8 million of borrowings, the group will gain $289.5 mil which it intends to use for reinvestment, further debt repayment and a special dividend.

Singapore Post's (SingPost) shareholders have voted in favour of the disposal of its Australian business, Freight Management Holdings (FHM) at an EGM held on March 13. It received 99.90% vote in favour of the disposal to Pacific Equity Partners. 

Upon completion of the disposal, SingPost will receive cash proceeds of A$775.9 million ($651.65 million) from the sale, which is the equity value of FHM after adjusting the enterprise value for debt carried. 

The group intends to utilise cash proceeds to repay Australian dollar denominated borrowings  of A$362.1 million, which were undertaken to finance the acquisition of FHM previously. With the disposal, the entire A$614.8 million of the group’s books would be repaid. 

The expected gain on disposal of FHM will amount to about $289.5 million for the financial year, the company says. 

In addition, part of this proceeds will be set aside for a special dividend and an amount to be retained for reinvestment or further debt repayment. 

SingPost’s chairman of the board of directors, Simon Israel, Isaac Mah, group CFO and Neo Su Yin, group COO, headed the presentation at the EGM on March 13. Mah and Neo were most recently appointed after the public firing of the three key executives in late December, 2024. 

Israel said that following the disposal, the board is focused on a number of things. This includes reaching an agreement with the Singapore government on the future operating model which will focus on profitability and sustainability; right sizing the cost base of SingPost; reviewing the International Logistics Business Unit; completing the board renewal and setting parameters for the group CEO appointment. 

The company also announced today that it will invest $30 million to grow its eCommerce Logistics Hub business which will have new sorting facilities that can process three times more small packages. 

It will also further consolidate mail with parcel operations under one roof to “achieve greater efficiency”.

Shares in SingPost closed 1.5 cents higher or 2.727% up at 56.5 cents on March 13.