- Proposal close to a 40% premium to last night’s price
- Former chief executive leading the consortium
- Well-timed offer as the business is on a strong footing
Shares in AIM-traded logistics and freight management firm Xpediator (XPD:AIM) jumped 30% to 39.5p after the group revealed it had been approached by a consortium with a cash proposal to buy the business.
The proposal, pitched at 42p per share, represents a 39% premium to last night’s closing price of 30.25p per share.
WHO IS BEHIND THE PROPOSAL?
The consortium making the proposal includes the group’s largest shareholder Cogels Investments, a holding company controlled by former chief executive Stephen Blyth; a Baltic private equity fund; and Justas Versnickas, the managing director and 20% shareholder of Delamode Baltics, a subsidiary of Xpediator.
Cogels owns 26.7% of the company, and the board said the consortium also had the support of Xpediator’s two largest independent shareholders, Shaun Godfrey and Sandu Grigore, who between them own 27.1% of the shares.
That would give the bidders control over 53.8% of the share capital which should be enough to secure a deal.
WHY TAKE THE COMPANY OVER NOW?
While the 39% premium to last night’s close may seem attractive at first glance, the offer price of 42p per share is roughly half the level the shares were trading at as recently as August last year.
The timing is opportune as the business has been trading well thanks to a strong performance from its freight forwarding operations in Bulgaria, Lithuania and Romania.
Meanwhile, the UK operations have been reorganised along the lines of the group’s successful Baltic business and net debt has stabilised.
Revenues for the nine months to September were around £300 million compared with £297 million for the whole of 2021, while reduced costs mean cash generation is much improved compared with last year.
‘The business is comfortably on track to meet management profit expectations for the full year with demand for our services remaining strong across all three divisions,’ said chief executive Mike Stone last month.
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