Saturday, April 23, 2011

Road Haulage Group Separates Off Freight Division In Share Sale

Stobart Splits Up and Sells Off
Shipping News Feature

UK – The Stobart Group, who saw the funeral of ex boss Eddie last week, are best known for road haulage operations and their iconic green and red trucks but, since their amalgamation with property group Westbury they have moved away from a road freight operation into cargo by rail and latterly into airports, property and even biomass fuel technology.

Now Stobart has announced it would seek £ 120 million of new investment with a share issue to enable it to split into five distinct operating divisions managing both rail and road haulage departments in a single transport and distribution division, airports and property as separate entities plus biomass and infrastructure. Stobart expect the offer to go to the market on the 16th May, a week before the announcement of group profits to the end of February.

Commenting on the Proposals, Rodney Baker‐Bates, Stobart Chairman, said:

"Stobart has come through a phase of consolidation, following strategic acquisitions made in 2008 and 2009. It is now stepping up its organic growth within the core transport and distribution businesses. In addition, the company has significant potential value in existing assets which, with the capital being raised through this placing, it is now in a position to unlock."

Andrew Tinkler, Chief Executive Officer, commented:

“Since listing in 2007 we have delivered consistently good performance with substantial growth in all areas of the business and also been able to invest in other areas of high growth potential such as Biomass. We are now a diverse company with risk and returns spread across a number of sectors. The new funding will give us the firepower to invest in those businesses which have the greatest potential, particularly Stobart Estates and Stobart Airports. The restructuring will clarify and sharpen the focus, strategic aims and value of each part of the business.”

The deal will necessitate Stobart buying up the half of the biomass company it does not own and the outstanding property portfolio of the Westbury Group, on which it seems it has an option, to consolidate all the relevant assets.