Stobart to demerge logistics in £280m deal

STOBART Group is to demerge its logistics division in a £280m transaction, that sees a new business, Eddle Stobart Logistics created.

Stobart will stay as a listed business, using the proceeds of the disposal to reduce debt, invest £55m in its green energy business and buy back £35m of shares over the next year.

William Stobart will leave the company’s board and lead Eddie Stobart Logistics as chief executive of the new private company, in which the listed company will retain a 49% investment. The new company is being backed by Douglas Bay Capital which will hold 51%.

Douglas Bay, formerly the Laxey Investment Trust, owned logistics group TDG until it was sold to Norbert Dentressangle in 2010.

Eddie Stobart Logistics generated EBIT of £25.6m on revenue of £475.7m in the year ended 28 February 2013.

Chief executive Andrew Tinkler said: “This is a further stage in delivering our strategy of creating and realising value for our shareholders. Moving forward, we are focused on capitalising on the opportunities in our infrastructure and support services divisions, enhanced by investment in Stobart Green Energy.”

William Stobart said: “I really welcome this investment from Douglas Bay and look forward to heading up the new partnership as chief executive. Douglas Bay has a strong track record of working with existing management teams within businesses, as they will do with us, to help drive growth.

“We already have an extremely loyal customer base who we look forward to continuing to work with. It is an exciting time for us to grow this business and I am looking forward to this next stage and the opportunities that it will bring for our employees and customers.”