Ann: Aurizon announces sale agreement for East Coast Rail, page-11

"A little disappointed with this, but it's hard to see that a demerger would have gone much better."

Valid.
I expect there would have been a fair amount of indiscriminate selling of the spun-out stub
[Truth be told, I was hoping and preparing for ECR to be spun-out because I think one would have been able to pick it up a mere 5x EV/EBITDA in the days after it commenced trading (or possibly even less if the post-de-merger vomiting was severe enough).]


"The net acquisition cost becomes 1.93bn - 0.425bn = $1.5bn, giving us an EV/EBITDA of around 19x on the acquisition versus around 7x on AZJ itself.
There had better be some almighty synergies and growth prospects."

Again, valid point.

I'm not sure there are many synergies to be had (I recall $5m to $7m being cited at the time of acquisition)

But even then, we get down to an EV/EBITDA multiple of, maybe, 17.5x.

So no bargain, no matter how one views it.

The only way it can be justified is on the basis that the business will still be making a margin hauling stuff long after I've shuffled off my mortal coil, and probably even after my progeny reach my current age.

.