Smiths News Acquires Assets From Dawson News Totalling GBP1.5 Million
03 August 2009 - 8:48PM
Dow Jones News
Smiths News PLC (NWS.LN), a wholesaler of newspapers and
magazines, said Monday that effective from August 3, following
Surridge Dawson Limited entering administration, the Group has
acquired certain assets for a consideration of GBP1.5 million.
MAIN FACTS:
-The Group will assume lessee responsibility for 20 of Dawson's
depots as well as IT equipment, which together with the assets
acquired, facilitate the early transfer of responsibility for
supply of newspapers and magazines in those territories, previously
supplied by Dawson, which were won by the Group in the recent round
of contract renegotiations with publishers.
-It is also anticipated that 1,800 of Dawson's distribution and
head office staff will transfer to the Group under TUPE
obligations.
-The Group expects to take responsibility for the supply of all
newspaper and magazine product previously supplied by Dawson in
these territories. The revenue associated with this will be an
increase of circa GBP250 million in the year to August 2010.
-In order to implement these new arrangements in a very short
time frame, the Group will be servicing the majority of contracts
through Dawson's existing network and, at least initially, using
their processes and technology.
-Consequently it is expected that the costs associated with the
operation of this infrastructure will be higher in the short term
than would typically be the case in the Group's current
network.
-By London Bureau, Dow Jones Newswires; Contact Ian Walker; +44 (0)20 7842 9296; ian.walker@dowjones.com