AUSTRALIA Post will buy Qantas out of freight company StarTrack Express to the tune of $408 million.
The move makes Australia Post the sole shareholder in the country's "leading express freight and logistics provider".
Prior to the deal being made last week Australia Post already owned half of StarTrack, having been involved in the company since 2003.
Australia Post managing director and CEO Ahmed Fahour said the buyout of the transport company was made to respond to customer demand.
"The growth in online shopping in Australia is increasing demand for flexible, timely and cost-effective delivery solutions for businesses and consumers," he said.
"StarTrack also provides infrastructure capabilities that are of strategic and commercial benefit to Australia Post, including access to a fully automated network, track and trace technology and line-haul services options.
"Under single ownership, both Australia Post and StarTrack will have a far more comprehensive offer to customers and the potential to unlock further value for our customers in the future.
"We have enjoyed a close working relationship with Qantas under the joint venture arrangements and we anticipate an even closer commercial relationship going forward.
"I look forward to continuing to work with StarTrack CEO Stephen Cleary and the team to deliver superior service to StarTrack customers."
Qantas CEO Alan Joyce said in August he would look at selling StarTrack.
"Over the long term we don't see that logistics trucking business as a core business for us and when the timing is right, we will sell the (StarTrack) business," he said at the time.
The deal will need to be approved by shareholders and the industry regulator.
Australia Post said they have no plans to make any changes to the management or operations of StarTrack.
It is anticipated that the StarTrack company and brand will remain standalone within the Australia Post group.