Allegro Funds buys Australia's Great Southern Rail

According a release, the unit was sold at an enterprise value of GBP2.5 million ($3.7 million), however with the inclusion the debt portion, the transaction is understood to be considerably larger.

Headquartered in Adelaide, GSR operates three transcontinental rail routes: The Indian Pacific (Sydney-Adelaide-Perth), The Ghan (Adelaide-Alice Springs-Darwin) and The Overland (Melbourne-Adelaide).

The deal represents non-core divestment for London-listed Serco which wants to focus on government services such as defence, security, prisons and aviation. GSR has been a unit of Serco since 1999.

Adrian Loader, founding partner and managing director with Allegro, told AVCJ that Allegro sees the investment as an opportunity to tap into Australia's luxury tourism market.

"When Serco first got involved in this business 10 years ago it was a transport business but with the advent of budget airlines the business has migrated from transport to tourism," he says. "So the last four or five years have gone into redoing to carriages, and the product has been repositioned as experiential tourism - more akin to doing a cruise."

The investment is the second out of Allegro's second fund which reached a first close of $120 million in November and expects to reach its $180 million target next month. The first deal involved auto components manufacturer Custom Bus.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Australasia
• Infrastructure
• Consumer
• Buyouts
• Europe
• Australia
• Infrastructure
• Consumer
• Allegro Funds
• buyout