Bidcorp is looking for a buyer for Best Food Logistics and its subsidiary PCL Transport as part of a wider strategy to exit "low margin logistics activities".
The news came as KFC confirmed that Best Food Logistics (formerly Bidvest) had won back the entirety of its KFC distribution deal after losing it to DHL in 2017.
Best Food Logistics had been servicing 350 KFC restaurants in the north of the UK since 26 March 2018, after DHL Supply Chain's share of the business was scaled back following its failure to deliver nationally for KFC in February of that year - something that made headlines internationally after it led to store closures.
However, this latest win has not changed the South African food service giant Bidcorp’s stated strategy to sell both Best Food Logistics and its subsidiary PCL Transport, according to its newly published annual accounts for the year to 30 June 2018.
In the accounts, the BSF Group, which is a subsidiary of Bidcorp containing Best Food Logistics and Bidfood, said: “Bidcorp has over a period of a few years been exiting low margin logistics activities globally where they do not fit into its model for its food service business and are thus considered to be non-core.
“Best Food Logistics were considered to fall into this category and accordingly this operation has now been classified as a discontinued operation, with a purchaser for this business being actively sought.”
Read more
- KFC re-signs Bidvest Logistics after DHL Supply Chain failure
- DHL Supply Chain committed to KFC despite losing bucket of work to rival Bidvest Logistics
- Bidvest Logistics rebrands as Best Food Logistics
In Bidcorp’s recent annual report for 2018, CFO David Cleasby revealed the impact of the loss of the KFC contract in 2017 on the business.
He said: “The exit of KFC in February and accompanying redundancies and restructuring, the downscaling of properties and vehicles, the subsequent onboarding of a part of the KFC contract, poor weather and reduced consumer confidence in the chain segment of the market all contributed, as did additional costs in relation to the exit of the business.
He added that a potential buyer had pulled out of buying the business “in the final stages” due to “internal reasons”.
The report to Bidcorp’s recent unaudited results for the half year to 31 December also reveal that PCL Transport’s profits had been “significantly impacted by low revenue increases, higher distribution costs and a dispute on transport rates.”
It added that the firm’s business relationship with Arla “has largely broken down and negotiations for the sale of the major portion of these activities is underway.”
BSF has yet to respond to a request for comment.
