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Pacific National to carry Toll's freight in billion-dollar contract


Asciano has signed a long-term contract with Toll Holdings for the haulage of intermodal rail freight, worth AUD 1 billion.
 
The contract is expected to generate revenues of up to $1 billion over the next five years. Under the contract, Asciano's Pacific National intermodal division will supply rail haulage services to Toll for the interstate movement of containers and cars. The initial contract term of five years includes options to extend for up to another 10 years.
 
Asciano managing director and CEO Mark Rowsthorn commented: "Asciano is very pleased to have signed this long term agreement with Toll, our largest customer.
 
“This contract reinforces the long standing relationship between Asciano and Toll, one of Australia’s largest freight forwarding companies.”
 
Pacific National has also granted Toll a lease over land within its Perth Freight Terminal precinct, where it intends to develop a freight forwarding facility immediately adjacent to the rail terminal.
 
"Locating the facility at the rail terminal will introduce greater efficiencies and will reduce costs associated with the pick up and delivery of freight at the rail terminal. It will also reduce truck movements and traffic congestion in the Kewdale vicinity," Mr Rowsthorn said.
 
"The benefits of co-locating rail and freight forwarding facilities are becoming increasingly important and may become a model for the development of intermodal freight in Australia."
 
Given the size of the contract and the previous relationship of the two companies (Asciano was spun off Toll when Toll acquired Patrick), the arrangement is subject to ACCC approval.

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