Tat Hong eyes A$800 million sale of Australian unit in review of strategic options

SINGAPORE crane supplier Tat Hong could sell its Australian construction and heavy-equipment arm as it weighs its future Down Under, said group chief executive Roland Ng.

The Australian Financial Review (AFR) had reported that the group may seek at least A$800 million (S$714.02 million) for the sale of Tutt Bryant Group (TBG), based on valuations in recent transactions. 

AFR added that Tat Hong has brought in Bank of America to help facilitate the sale. 

“The process is a review of strategic options for (Tat Hong) shareholders,” Ng told The Business Times on Thursday (May 18).

While the company has identified growth areas in Australia, like the equipment rental business, it might need some “financial muscle” to grow and compete with larger players, some of whom have revenue in the billions, he said.  

If shareholders of Tat Hong opt to sell TBG, proceeds from the sale may be used to re-enter the Australian market, possibly through partnerships with other companies, he added. 

The new developments come months after Bloomberg reported that Tat Hong was at the early stages of deliberating a sale of TBG and was tipped to be seeking more than US$500 million. 

Tat Hong entered the Australia construction equipment distribution and manufacturing market in 1996 by acquiring the Tutt Bryant Equipment sales division. TBG was listed on the Australian Securities Exchange in 2005, but Tat Hong delisted the entity in 2010 following a compulsory acquisition. 

Tat Hong, which used to be listed on the Singapore Exchange’s mainboard, is one of the largest crane-owning companies in the Asia-Pacific; it has more than 1,500 cranes in its fleet. It went private in 2018 following a buyout from Ng and Standard Chartered’s private equity arm.