TIDMESL
RNS Number : 9019S
Eddie Stobart Logistics PLC
28 June 2018
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014 ("MAR"). Market
Soundings, as defined in MAR, were taken in respect of the proposed
Placing with the result that certain persons became aware of inside
information, as permitted by MAR. That inside information in
relation to the Placing is set out in this Announcement and has
been disclosed as soon as possible in accordance with paragraph 7
of article 17 of MAR. Therefore, those persons that received inside
information in a Market Sounding are no longer in possession of
inside information relating to the Company and its securities.
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES,
AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY
JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF LOCAL
SECURITIES LAWS OR REGULATIONS. THIS ANNOUNCEMENT IS FOR
INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY
INVITATION, SOLICITATION, RECOMMATION, OFFER OR ADVICE TO ANY
PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY
SECURITIES IN EDDIE STOBART LOGISTICS PLC OR ANY OTHER ENTITY IN
ANY JURISDICTION.
Eddie Stobart Logistics plc
("Eddie Stobart" or the "Company")
Acquisition of The Pallet Network Group Limited
and
Placing of shares to raise GBP30 million
Further to the announcement made on 7 June 2018, Eddie Stobart,
a leading UK supply chain, transport and logistics group, is
pleased to announce that it has entered into an agreement to
acquire the entire issued share capital of The Pallet Network Group
Limited ("TPN"), a leading provider of pallet distribution services
across UK and Ireland, for total consideration of GBP52.8 million,
on a cash and debt free basis (the "Acquisition"). Completion of
the Acquisition is expected to occur on or around 29 June 2018
following admission of the Placing Shares.
Eddie Stobart also announces a placing with institutional
investors to raise GBP30 million before expenses (the "Placing")
through the issue of 21,428,572 Placing shares of 1 pence each in
the capital of the Company ("Placing Shares") for 140 pence
("Placing Price") per Placing Share. The Placing was well supported
by new and existing institutional investors.
Of the total consideration of GBP52.8 million, GBP44.14 million
is payable in cash upon completion and the remaining GBP8.66
million will be payable to certain of the Sellers over a period of
two years following completion. The Acquisition will be funded in
part by the net proceeds of the Placing and in part through the
extension of the Eddie Stobart group's ("Eddie Stobart Logistics")
existing debt facilities with its current syndicate of lending
banks.
Alex Laffey, Chief Executive Officer of Eddie Stobart,
commented:
"We are delighted that TPN will be joining Eddie Stobart
Logistics. TPN is a leading player in pallet distribution across
the UK and we are confident that this transaction will
significantly enhance our capabilities in a space in which we do
not currently operate and consequently offers cross-selling
opportunities to serve our clients' growing needs.
I would like to welcome Mark Duggan, Managing Director, the
management team and the TPN network members to Eddie Stobart
Logistics and look forward to working closely with them all. This
acquisition is in line with our strategy and the Board is confident
that TPN will strengthen our position as a leading provider of
end-to-end supply chain solutions."
Background to and strategic rationale for the Acquisition
The acquisition of TPN significantly enhances Eddie Stobart
Logistics' existing skills and capabilities, including meeting
customers' needs for next day, less than truck load deliveries,
positioning Eddie Stobart Logistics in an attractive segment which
has grown at a significantly greater rate than the wider logistics
market over the last three years. The Directors believe that this
combination will provide benefits to both businesses and to TPN
network members, through cross-selling to existing Eddie Stobart UK
customers and collaboratively deploying our enhanced operating
model into Europe.
The TPN management team, led by Mark Duggan, will continue to
run the TPN business following completion. The Acquisition is
expected to be earnings and cash enhancing in Eddie Stobart
Logistics' 2018 financial year.
About TPN
TPN is one of the UK's leading palletised freight distribution
networks offering premium, economy and tail-lift services
throughout the UK and Ireland.
Founded in 2000 and headquartered in Minworth, TPN operates the
UK's second largest pallet network, comprising 106 regional
hauliers ("members"). TPN's hub-and-spoke model provides
distribution services from three central hubs in Minworth, Preston
and Northampton to a total of 121 distribution sites.
Employing over 230 staff, TPN processed approximately 3.9
million pallets in the twelve months to 31 March 2018, with daily
capacity for up to circa 21,000 pallets for customers across a
broad range of sectors. TPN has a loyal membership base, with the
majority of members having formed part of TPN's network for more
than ten years.
For the period from 15 December 2015 to 31 March 2017, TPN
recorded audited EBITA of GBP5.3 million and profit before tax of
GBP0.8 million on revenues of GBP119.5 million and as at 31 March
2017, had net assets of GBP0.4 million. For the twelve months to 30
November 2017, TPN generated unaudited revenues of GBP108.9 million
and adjusted EBITA of GBP5.8 million.
The Sellers of TPN are LDC, Neil England and the TPN management
team, being Mark Duggan, Paul Robinson and Mark Kendall. The
acquisition provides an exit for TPN's institutional investor, LDC,
the private equity arm of Lloyds Banking Group. The Placing and the
Acquisition are inter-conditional.
The Placing
The Board is pleased to announce that the Company has
conditionally raised gross proceeds of approximately GBP30 million
through a placing (the "Placing") of 21,428,572 new Placing Shares
at a price of 140 pence per share. The Placing has been undertaken
with new and existing institutional shareholders by Cenkos
Securities PLC ("Cenkos") and Joh. Berenberg, Gossler & Co. KG,
London Branch ("Berenberg")
The net proceeds of the Placing (after commission and expenses
of the Placing of approximately GBP1 million) will be used to fund
the Acquisition and for general corporate purposes.
The Placing Price represents a discount of 0.4% to the closing
middle market price of 140.5 pence per existing ordinary share on
27 June 2018, being the last Business Day before the announcement
of the Placing.
The Placing Shares will, when issued, rank in full for all
dividends and other distributions declared, made or paid on
ordinary shares by reference to record dates falling after their
date of issue and otherwise rank pari passu in all respects with
the existing ordinary shares.
Application has been made for the Placing Shares to be admitted
to AIM and, subject to the Placing and the Acquisition becoming
unconditional, it is expected that Admission will become effective
and trading in the Placing Shares will commence at 8:00 a.m. on 29
June 2018
The Placing and the allotment of the Placing Shares are being
made pursuant to existing authorities to allot shares and disapply
pre-emption rights under section 551 and section 570 of the
Companies Act 2006, which the Directors were given at the Company's
Annual General Meeting held on 29 May 2018.
Total Voting Rights
Following admission of the Placing Shares, Eddie Stobart's
issued ordinary share capital will comprise 379,347,372ordinary
shares. Therefore, the total number of ordinary shares with voting
rights in Eddie Stobart following admission will be
379,347,372.
The above figure of 379,347,372 may be used by shareholders as
the denominator for the calculations by which they will determine
if they are required to notify their interest in, or a change to
their interest in, Eddie Stobart under the FCA's Disclosure
Guidance and Transparency Rules.
Enquiries:
Eddie Stobart Logistics plc Via FTI Consulting
Alex Laffey, Chief Executive Officer
Damien Harte, Chief Financial Officer
FTI Consulting LLP
Nick Hasell/Alex Le May/Matthew O'Keefe
eddiestobart@fticonsulting.com
www.fticonsulting.com 020 3727 1340
Cenkos Securities (Nomad and Joint
Broker)
Nicholas Wells/Harry Hargreaves
www.cenkos.com 020 7397 8928
Berenberg (Joint Broker)
Chris Bowman/Toby Flaux/James Brooks
eddiestobart@berenberg.com
www.berenberg.com 020 3207 7800
About Eddie Stobart
Eddie Stobart is a leading supply chain, transport and logistics
business providing industry-leading service to many of the UK's
best-known brands.
Founded in 1970 by Edward Stobart, the business is listed on the
London Stock Exchange's Alternative Investment Market (AIM) and
operates across a broad array of core sectors including e-commerce,
manufacturing, industrial & bulk, retail and consumer.
From its headquarters in Warrington, the business operates
circa.2,300 vehicles, c.4,000 trailers and 26 distribution centres
throughout the UK and Europe, providing its services to a range of
national and international customers.
Through Eddie Stobart's acquisitions, its network and scale has
grown. iForce (acquired in April 2017 ) has three owned
distribution centres and operates out of six customer sites and
Speedy Freight (acquired in July 2017) has 40 branches.
Collectively, these sites significantly expanded the scale of the
Eddie Stobart network.
Further information about Eddie Stobart is available at:
http://eddiestobart.com/
Please click here to find information for investors:
http://eddiestobart.com/investor-relations/
About TPN
TPN is one of the UK's leading palletised freight distribution
networks offering premium, economy and tail-lift services
throughout the UK and Ireland.
Founded in 2000 and headquartered in Minworth, TPN operates the
UK's second largest pallet network, comprising 106 regional haulier
members. TPN's hub-and-spoke model provides distribution services
from three central hubs in Minworth, Preston and Northampton to a
total of 121 depots nationally.
Employing over 230 staff, TPN processed approximately 3.9
million pallets in the twelve months to 31 March 2018, with daily
capacity for up to circa 21,000 pallets, for customers across a
broad range of sectors. TPN has a loyal membership base, with the
majority of members having formed part of TPN's network for more
than ten years.
Further information about TPN visit
https://thepalletnetworkltd.co.uk/
This announcement has been issued by Eddie Stobart and is the
sole responsibility of Eddie Stobart. This announcement is for
information purposes only and does not constitute an offer to sell
or an invitation to subscribe for or a solicitation of an offer to
buy or subscribe for any securities in any jurisdiction including
in which such an offer or solicitation is unlawful and is not for
distribution in or into, without limitation, the United Kingdom,
the United States, Canada, Australia, Japan, New Zealand, Russia or
the Republic of South Africa (the "Restricted Jurisdictions") or to
US persons (within the meaning of Regulation S of the United States
Securities Act 1933 (as amended) (the "Securities Act")).
The Placing Shares have not been and will not be registered
under the Securities Act or under the applicable securities laws of
any state in the United States or any Restricted Jurisdiction and,
unless an exemption under such act or laws is available may not be
offered for sale or subscription or sold or subscribed directly or
indirectly within the Restricted Jurisdictions or for the account
or benefit of any national, resident or citizen of the Restricted
Jurisdictions. No public offering of securities will be made in the
United States. The distribution of this announcement in other
jurisdictions may be restricted by law and therefore persons into
whose possession this announcement comes should inform themselves
about and observe any such restrictions. Any failure to comply with
these restrictions may constitute a violation of the securities
laws of such jurisdictions.
Berenberg, which is authorised by the German Federal Financial
Supervisory Authority and subject to limited regulation by the
Financial Conduct Authority in the United Kingdom and Cenkos
Securities, which is authorised and regulated by the Financial
Conduct Authority, are acting exclusively for Eddie Stobart and for
no one else in connection with the Placing and will not be
responsible to anyone other than Eddie Stobart for providing the
protections afforded to clients of Berenberg and Cenkos Securities,
respectively, nor for providing advice in relation to the Placing
or any other matters referred to in this announcement.
In member states of the European Economic Area (the "EEA"), this
announcement is being distributed only to and is directed only at
persons who are "qualified investors" within the meaning of Article
2(1)(e) of the Prospectus Directive (Directive 2003/71/EC) (as
amended, including by Directive 2010/ 73/EU, to the extent such
amendments have been implemented in the relevant Member State and
including any relevant implementing measure in the relevant Member
State) ("Qualified Investors").
This announcement is being distributed only to, and is directed
only at, persons in the United Kingdom who have professional
experience in matters relating to investments who fall within the
definition of "investment professionals" in Article 19(5) of the
Financial Services and Markets Act 2000 (Financial Promotion) Order
2005, as amended, (the "Order") or are high net worth bodies
corporate, unincorporated associations and partnerships and
trustees of high value trusts or other persons falling within
Articles 49(2)(a)-(d) of the Order and who in each case are also
Qualified Investors (together, "Relevant Persons"). Any investment
activity to which this announcement relates is available only to,
and will be engaged in only with, Relevant Persons. No person who
is not a Relevant Person may rely on this announcement.
Information to Distributors
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the "MiFID
II Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the Product Governance
Requirements) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has
determined that the Placing Shares are: (i) compatible with an end
target market of (a) retail investors, (b) investors who meet the
criteria of professional clients and (c) eligible counterparties,
each as defined in MiFID II; and (ii) eligible for distribution
through all distribution channels as are permitted by MiFID II (the
"Target Market Assessment"). Notwithstanding the Target Market
Assessment, Distributors should note that: the price of the Placing
Shares may decline and investors could lose all or part of their
investment; the Placing Shares offer no guaranteed income and no
capital protection; and an investment in the Placing Shares is
compatible only with investors who do not need a guaranteed income
or capital protection, who (either alone or in conjunction with an
appropriate financial or other adviser) are capable of evaluating
the merits and risks of such an investment and who have sufficient
resources to be able to bear any losses that may result therefrom.
The Target Market Assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling
restrictions in relation to the Placing. Furthermore, it is noted
that, notwithstanding the Target Market Assessment, the Joint
Brokers will only procure investors who meet the criteria of
professional clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (b) a recommendation to any
investor or group of investors to invest in, or purchase, or take
any other action whatsoever with respect to the Placing Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Placing Shares and determining
appropriate distribution channels.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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