ComfortDelGro commences rail services in NZ, replaces previous operator

MAINBOARD-LISTED ComfortDelGro Corporation C52 commenced operations of New Zealand's largest rail network, the Auckland Rail Franchise (ARF), on Monday (Jan 17). This was done through Auckland One Rail (AOR), a 50:50 joint venture between ComfortDelGro and Australian rail operator and maintenance company UGL Rail Services.

AOR took over the entire issued share capital of the network's previous operator, Transdev Auckland Limited, for NZ$10,100 (S$9,330). This was fully satisfied in cash and funded through internal resources, the company said.

Immediately after completion, ComfortDelGro and UGL each increased their respective shareholding in AOR to NZ$5 million. This was in accordance with the requirements of the Auckland Transport.

The takeover of Transdev has no material impact on ComfortDelGro's net tangible assets or earnings per share for the year to Dec 31, 2022, the company said in a bourse filing.

AOR was awarded a S$1.13 billion contract to operate rail services in Auckland in August last year. The contract was for an initial term of 8 years, with an opportunity for further extensions. It comprises all passenger train operations across the ARF network, including the operation and maintenance of stations, the management and maintenance of rolling stock, customer services, safety and security management, as well as industrial relations management.

This is the first overseas heavy rail venture by a Singapore company, and ComfortDelGro's first in New Zealand, the company said. The commencement of rail operations in Auckland also marks "a new chapter in the ComfortDelGro growth story", said chairman Lim Jit Poh.

"It signals our move into the international rail scene - 18 years after we began rail operations in Singapore through the North East Line, which was the world's first fully automated underground line," Lim added.

ComfortDelGro shares closed on Monday at S$1.39, up by S$0.03 or 2.2 per cent, before the announcement.

READ MORE:

• ComfortDelGro acquires 90% stake in Ming Chuan Transportation for S$8.5m
• ComfortDelGro unit divests Vietnamese taxi company
• ComfortDelGro unit to expand bus service operations in Queensland
• iFast to acquire 85% stake in UK-incorporated BFC Bank for £40m
• iFast prices private placement at top end of range; raises S$105m
• Yoma to acquire controlling interest in Wave Money via US$53m deal