A new buyer has emerged for Best Food Logistics with a sale expected to be completed within weeks, according to parent group Bidcorp.
The sale comes despite Best Food Logistics returning to profitability after winning back the entirety of its KFC distribution deal earlier this year, which it had lost to DHL in 2017.
The company, formerly known as Bidvest, also boosted its portfolio last month after landing a major long-term supply deal with Pizza Hut.
Selling Best Food Logistics is part of Bidcorp’s wider strategy to divest itself of its UK logistics activities which saw it sell PCL Transport to Arla Foods in April.
An earlier attempt by the South African food services giant to sell Best Food Logistics hit the buffers in September last year after the potential buyer pulled out of the deal.
The subsidiary, which has operating licences for over 540 trucks and 140 trailers, has its headquarters in Royton, Oldham and operates depots in Banbury, Taunton, Hoddesdon, and Larbert in Scotland.
Announcing the company’s annual results to 30 June 2019, group chief executive Bernard Berson did not identify the buyer but said: “Negotiations for the sale are progressing. We remain hopeful that we will conclude that in the next month or two.”
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He added that Best Food Logistics is now operating profitably after regaining the KFC contract.
Berson added: “We are optimistic that the distraction of dealing with the discontinued operations will be behind us into financial year 2020, enabling the group to be fully focused on its core food service markets.”
Bidcorp's strategic report on the company results revealed that Best Food Logistics’ performance had continued to improve in the second half of this year.
It said: “Service levels are significantly better and customer pricing has been substantially increased to better reflect the risk and reward of these activities. A much-improved financial result is expected in the financial year 2020.”
It added that the sale of PCL to Arla Foods had resulted in “significant further costs associated with the exit (being) incurred in the second half, particularly vehicle fleet disposal costs".
A warehousing contract is also “in the process of disposal”, the report revealed.
Best Food Logistics lost its lucrative deal with fast food chain KFC in 2017 when the contract was awarded to DHL along with Quick Serve Logistics (QSL).
However, just days after the contract went live in February 2018 it hit major distribution problems which saw around two-thirds of KFC’s 900 UK stores temporarily close and the supply story go international.
As a result, the southern half of DHL’s contract was returned to Best Food Logistics, then known as Bidvest, in March 2018, with the rest of the contract returned to Best Food Logistics in April this year.
