Thomas Cook

17th September 2019


Eddie Stobart acquisition proposal the first of many?

Eddie Stobart who recently suspended trading of shares after a multi-million pound accounting error that saw the firm’s profits shrink to a level which the Board has described as the ‘low end of expectation’, has been approached for potential buy-out by Dbay Advisors.

The road haulage firm started the year with an impressive performance, defying potential Brexit concerns with the prospect of a March departure, but suffered after a multi-million pound accounting error saw a decline in share performance. This could be what has motivated the firm that hold the third-largest share in Eddie Stobart to begin buy-out negotiations.

Plimsoll’s Road Haulage industry analysis shows consistent improvement in Eddie Stobart’s overall financial rating from 2014 to 2017. The company also came 7th in the industry for pre-tax profits, and 3rd in total sales in the industry back in 2017.

In spite of such a strong performance, the company was rated as ‘worth considering’ for acquisition due to factors such as a low number of shareholders, a large difference between current and potential future values, high gross earnings and the sales growth being above the industry average. This twinned with a drop in share price and overall financial rating could make for a highly attractive acquisition opportunity; a real opportunity.

In Plimsoll’s analysis of the UK’s top performing 1500 Road Haulage companies, there were a further 299 companies that were rated as ‘highly attractive’ for acquisition, and a further 1055 as ‘worth considering. Looking at the ‘highly attractive’ acquisition opportunities by size, the analysis found that only one company over £50million was worth considering, three companies between £20million and £50million worth considering, 20 companies between £5million and £20million, with the remaining 275 opportunities being of a size smaller than £5million.

The Road Haulage industry analysis allows people to filter by region, by size and a number of other metrics, allowing businesses and business leaders to find the attractive acquisition opportunities that match their acquisition opportunities.

To find out more information on the UK Road Haulage industry analysis, click here.