Thursday, July 16, 2020

More Upheaval in a Transport Associated Company Name Familiar to All

Major Business Sectors Sold Off for an Initial Thousand Pounds
Shipping News Feature

UK – So the Stobart Group has made good on its recent promise that it would exit the rail sector by the end of its next financial year. The Stobart Rail and Civils businesses have been bought by Bavaria Industries Group AG, which has paid an initial cash consideration of just £1,000.

Of course this is Stobart so nothing is ever simple, the company, originally known for the famed Eddy Stobart truck empire, has been wracked with arguments and problems, and only in May of this year did Eddie Stobart Logistics acquire the Eddie Stobart and Stobart brands from the Stobart Group, having previously operated under licence, finally getting the intellectual property rights apparently at a cost price of £10 million.

Now the German family owned holding company that acquires majority interests in companies it believes have potential, has snapped up the assets of the divisions concerned, plus 188 staff who will TUPE over to the new operation. It will however see the purchase price rise to nudge £3 million dependent on the outcome on conclusion of a single legacy contract.

The sale is a ‘share sale’ which means the sale of everything in the Company including the incorporated Company itself with its assets, liabilities and obligations. Bavaria will provide financial support to Stobart Rail & Civils and continue business as usual for now, whilst the agreement also includes a three-month Transitional Service Agreement for Stobart Group to provide certain back office services to support Stobart Rail & Civils in the immediate term i.e. I.T support, Payroll.

The Stobart Group owns both Carlisle Lake District and Southend airports, the latter from which it saw easyJet, Ryanair and Wizz Air provide flights to over 40 destinations. Post coronavirus of course things may well be different with easyJet already closing facilities at Southend and Wizz Air currently only offering flights to Budapest from the Essex base. Warwick Brady, chief executive of Stobart Group, said:

”In June we set out our strategy which will see the group focus its investment on our aviation assets, particularly London Southend Airport. The sale of the rail and civils business removes the obligation for the group to fund the expected ongoing losses of the rail business and is a first step in achieving our goal of focusing our investment on aviation."