UPDATE 2-Eddie Stobart gets lifeline as shareholders back rescue deal


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(Reuters) – Eddie Stobart’s (ESLE.L) shareholders on Friday voted in favor of a takeover from top investor DBAY Advisors, allowing the logistics company’s green and red trucks to continue trading.

Eddie Stobart’s shareholders voted “overwhelmingly” in favor for private equity group DBAY to pump in 55 million pounds ($70.57 million) of new financing in return for a majority stake, the company said.

DBAY, which currently has nearly 30% of Eddie Stobart, has also agreed a new 20 million pounds credit facility with the company.

Eddie Stobart has had a torrid year, in which its chief executive Alex Laffey departed and trading in the company’s shares were suspended following its failure to publish half-year results on time.

Rival Wincanton (WIN.L) last month dropped plans to make an offer to buy Eddie Stobart, citing concerns about the target’s financial performance and liquidity.

Eddie Stobart has also scrapped its dividend and warned that annual net debt would rise to 200 million pounds.

“The company’s shareholders have approved its proposal to provide the liquidity needed to safeguard the immediate future of the business,” DBAY Advisors said in a separate statement.

“The business will receive the necessary funding to continue trading through the busy Christmas period,” it said.

Eddie Stobart provides logistics facilities to construction companies, retailers and industrials, with about 2,700 vehicles, 5,000 trailers and 43 operating centers across Britain and Europe.


Investor approval comes a day after the Unite union urged Eddie Stobart to delay the decision on DBAY’s offer and encourage other bids to come in.

Eddie Stobart also has a funding offer on the table from its former group boss Andrew Tinkler. Tinkler was the chairman of Eddie Stobart and chief executive officer of Stobart (STOB.L), former parent of Eddie, between 2004 and 2017.

Tinkler’s investment vehicle TVFB said it was pleased to see the rescue package agreed.

“I hope the company can return to its former glory,” Tinkler said in a statement.

Eddie Stobart said the DBAY proposal had the support of its lenders, which were said to be willing to provide the financing needed for the agreement to go through.

The lenders had warned that if any alternative proposal needed more funding, they would not provide it.

Eddie Stobart said the two parties intended to complete the proposed transaction as soon as possible.

Reporting by Yadarisa Shabong in Bengaluru; Editing by Maju Samuel/ Arun Koyyur/Jane Merriman


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