Citic, FountainVest Weigh Sale of $1 Billion Loscam Australia Assets

(Bloomberg) -- Buyout firms Citic Capital and FountainVest Partners are considering a sale of the Australia and New Zealand assets of pallet maker Loscam Asia Pacific Co., according to people familiar with the matter.

The private equity companies, which own a combined 55% stake in Loscam, are in discussions with prospective financial advisers to arrange a potential sale that could raise more than $1 billion, the people said, asking not to be identified because the information is private.

A formal sale process may begin as soon as in the coming months, the people said. The assets could draw interest from other buyout firms and industry players seeking to expand in the region, one of the people said.

The proceeds could help expand Loscam’s remaining business in China and Southeast Asia, one of the people said.

Citic Capital and FountainVest Partners bought 55% of Loscam in 2018 from Sinotrans Ltd., a unit of China Merchants Group, for 2.48 billion yuan ($389 million). After the deal, Citic Capital held 33% and FountainVest owned 22%, with the rest retained by Sinotrans.

No final decision has been made and the talks may not lead to any transaction, the people said. A representative for Citic Capital declined to comment. Representatives for FountainVest and Sinotrans didn’t immediately respond to requests for comment.

Founded in Australia in 1942, Loscam makes wood and plastic pallets used to transport goods, according to its website. It also produces cages for high-value freight, as well as fresh-produce crates and bulk containers.

©2022 Bloomberg L.P.

With assistance from Bloomberg