DX Group said it had agreed to a £315m cash takeover offer from a subsidiary of equity giant HIG Capital.
The deal means DX shareholders will be entitled to 48.5p per share, consisting of 47.5p in cash and a final dividend of 1p for the year ending 1 July 2023.
The acquisition by Transit Bidco values DX’s entire issued and to-be-issued share capital at approximately £314.8m.
Bidco said there was “a compelling strategic and financial rationale” for buying DX, pointing out it operated in “attractive niche markets with supportive secular market trends” and it acknowledged the parcel freight firm’s strong performance and progress in recent years.
Mark Hammond, chair of DX, said: “Since the introduction of its turnaround plan in 2018, DX has demonstrated a strong track record in sales growth, profitability, and margin improvement.
“This progress has been most recently evidenced in our latest full year results which recorded the highest revenue in our 48-year history.
“Furthermore, in addition to our strong financial and operational performance, in the last eighteen months, the board has successfully settled its claim in relation to Tuffnells, resolved its internal corporate governance inquiry, achieved the re-admittance of its shares to trading, and deepened the bench of executive and non-executive talent.
“Viewed in conjunction with its turnaround and financial momentum, DX is a company reinvigorated and ready for the next phase of growth.”
Hammond added: “Nonetheless, the board recognises the challenges that companies of DX’s size and shareholder structure face in raising further capital for expansion or acquisitions and the challenges that major shareholders have in crystallising value for their holdings. Furthermore, DX is dependent on UK demand growth across its operating sectors, and thus exposed to potential economic and global investment sentiment headwinds.
“The offer from Bidco recognises the value of the platform that has been built, offers shareholders an opportunity to crystallise an attractive value for their holdings and provides DX with an excellent partner for the next stage of its development.”
HIG MD Tobias Borkowski said it was delighted to be announcing the cash acquisition: “DX has long established itself as a leading provider of specialist delivery services in the UK, supported by a strong management team, diligent workforce and well-invested infrastructure,” he said.
“We look forward to partnering with the DX management team in accelerating DX’s next phase of growth.”
