Cash transport company Armaguard has secured its short term future after locking in a $50 million deal with its largest customers.
The agreement, funded by Commonwealth Bank, Westpac, NAB, ANZ, Coles, Woolworths, Bunnings and Australia Post, means Armaguard will receive monthly payments in exchange for efficiency and restructuring requirements.
Those monthly payments will also come with other key performance indicators and can only be unlocked if Armaguard is keeping up their end of the deal.
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Armaguard is Australia’s sole distributor of bank notes and coins and there are concerns the country’s cash economy would not survive if the company doesn’t.
The deal also buys time for the country’s biggest businesses to come up with a plan if Armaguard fails.
On Monday, the Transport Workers Union national assistant secretary Emily McMillan welcomed the deal saying 1400 workers were relieved to have some job security for the year ahead.
She also said it was important for “wealthy banks and retailers” to ensure the long-term viability of cash-in-transit services.
“Regional communities and many in society still rely on cash transactions,” Ms McMillan said.
The deal comes three months after Armaguard rejected a $26 million deal from the Australian Banking Association, the big four banks, Woolworths, Coles and Australia Post despite being told the company was not financially viable.
Instead, its parent company Linfox, owned by billionaire Lindsay Fox, announced it would pump $10 million into the business as Armaguard worked to find solutions to its financial woes.
Concerns over Armaguard’s future prompted Coles to stop cash deliveries to its stores earlier this year, but the supermarket later reversed the decision.
It also reduced the amount of cash customers may withdraw in shops from $400 to $200, but there are no plans to unwind the change.
AAP has contacted Linfox for comment.
