Aurizon Holdings announced the sale of its East Coast Rail business

Aurizon Holdings Limited (ASX: AZJ) announced that it has entered into a binding sale contract with Magnetic Rail Group Pty Ltd to buy the East Coast Rail (ECR) business. Following anticipated completion adjustments, Aurizon will get cash consideration of approximately AU$425 million, which denotes the equity value of ECR.

The purchaser will also accept ECR’s previous AU$500 million debt facilities, no capital gains tax is projected, and completion is targeted for initial 2023, with AU$125 million of the proceeds to be deferred for 12 months. After completion of the ECR sale, proceeds will primarily be used to decrease Aurizon’s debt and finally form part of Aurizon’s available capital to be used aligned with its capital allocation framework.

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