Eyes on Team Global Express’ soaring loan bill
Allegro’s Team Global Express is getting a lot of attention as the business fields inbound interest from cashed-up overseas buyers.
Under Christine Holgate’s customer-centric leadership, the group has done a complete 180, delivering a 17 per cent increase in top-line revenue growth to $3.7 billion for the 2023 financial year. This includes the Australian Parcels Group, Strait Link and the NZ operations.
Underlying EBITDA increased by 44 per cent to $124.7 million, alongside operating cash flows of $108.5 million.
But it was the interest rate attached to TGA’s accounts that caught Street Talk’s attention.
Team Global Express boss Christine Holgate. Steven Chee
Accounts show the logistics giant is sitting on a syndicated asset-backed loan with a carrying value of $134.5 million. The floating-rate loan carries a 14.1 per cent interest rate – almost 1000 basis points above the 3-month bank bill swap rate. This is up from 11.5 per cent in 2022.
Street Talk understands the debt, which was written at the time of Allegro’s acquisition, was provided by Nomura and Gordon Bros and secured against the company’s vehicles, freight and equipment assets. Principal repayments started on April 1 and will continue until the loan expires in September 2025.
Sources who spoke to Street Talk were floored by the rate, saying a business that’s purportedly doing well should be paying half that amount. For a point of comparison, data centre business AirTrunk ruled off a $4.76 billion loan last month at a 7 per cent to 8 per cent interest rate.
Of course, when Allegro acquired the struggling business from Japan Post two years ago, the business was losing around $140 million a year, making it difficult to secure cheap financing. As such, a deal
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