Tuesday, March 21, 2017

Investment Firm Wants Changes at Parcel Carrying Specialist After Stock Collapse

Call for EGM and New Directors to be put in Place
Shipping News Feature
UK – After profit warnings were issued in November 2015 and in February 2017 the value of the DX Group, the parcel delivery service which is responsible amongst other things for the distribution of US passports and many legal documents throughout the UK, plummeted 90% according to its main stockholders. The company was formed in 1975 to bypass Royal Mail services during that group's strikes in the 1970's and now the principal shareholders, Gatemore Capital Management LLP, have called for an Extraordinary General Meeting to have the Chairman, Bob Holt, and Non-Executive Director, Paul Murray replaced.

Gatemore, which holds 11.3% of DX stock, is requesting the election of four new independent board members and has gone so far as to select the candidates it wishes put in place. It is no coincidence that these include ex Tufnell parcels staff, that company being generally recognised as DX’s main competitor. Gatemore says it has worked with other large shareholders of DX to identify and vet the four candidates. It states that these nominees, collectively ‘would constitute one of the best and most well-rounded boards in the UK delivery sector’. Liad Meidar, Managing Partner & Chief Investment Officer at Gatemore, commented:

“As the largest shareholder in DX Group, we continue to see tremendous unrealised value in the business. DX is a trusted brand with leading a position in document exchange, secure delivery, and IDW freight, despite a precipitous decline in share value following a series of profit warnings. We are as eager as anyone to see DX succeed and we are confident that there is consensus amongst shareholders about the need for change.”

The four whom Gatemore have put up for selection at the company which was formerly known as Nightfreight and once part of the Hays group are:

  • Ronald Series as Chairman: Mr Series has over 25 years of experience in executive and non-executive roles within transport, logistics, and shipping. In his past role as Chairman of Tuffnells Parcels Express, Mr Series lead a turnaround process. Recently, he was Chief Restructuring Adviser at Lonmin Plc.
  • Lloyd Dunn as Non-Executive Director (effective 1 July 2017): Mr Dunn has been in transport for 38 years. In 1985, he joined Russell Black as a founding member of Nightfreight. In 2002, he joined Tuffnells and became Managing Director in 2003 and CEO in 2005. He led the company from near-bankruptcy to a sale for £135 million in 2015.
  • Paul Goodson as Non-Executive Director: Mr Goodson was Executive Chairman of Great Bear Distribution, a leading independent third party logistics business, which he successfully sold to Culina to create a £400 million group. Mr Goodson spent 13 years with Barclay Private Equity, during which he was involved in the purchase and sale of Nightfreight.
  • Russell Black as Non-Executive Director: Mr Black has over 40 years of experience in the transport industry. He was founder and CEO of Nightfreight from 1984 to 2002, during which time it was listed on the London Stock Exchange at an initial capital value of £48 million.