The DX Group and John Menzies Distribution merger could be sealed this summer after both boards approved a revised offer that satisfies objections from a major shareholder.

The revised deal, which sees the price of the deal slashed from £60m to £40m, has removed the opposition of major DX shareholder Gatemore Capital Management, which earlier this year had threatened to block the deal unless the offer was improved, increasing its shareholding to facilitate this.

Under the revised offer, DX Group will acquire Menzies Distribution on a debt-free basis for £40m in cash, down from the £60m previously proposed.

It will also issue new DX shares representing 65% – rather than 75% – of the enlarged group's share capital to Menzies shareholders.

The cash consideration will be satisfied by new borrowings by the enlarged group, and a share dividend will be reinstated.

The revised deal appears to heal the rift between Gatemore and DX Group’s management. In May this year Gatemore accused DX management of losing £200 million of value and called for improved terms in a letter to DX shareholders, having stated its opposition to the deal in March.

However, Gatemore managing partner Liad Meidar said the deal “better reflects the inherent value in DX Group and will provide the company with a healthier financial footing”.

If shareholders follow Gatemore’s lead and vote in favour of the revised deal the merger could be completed this summer.

In a joint statement the two firms said the revised deal “would benefit the customers of DX and Menzies Distribution through the creation of a logistics and parcel carrier of enhanced scale and capability operating through a 24-hour logistics network across the UK and Ireland".

DX and John Menzies estimate the merger could generate cost synergies of around £10m a year, in regards duplication of property, vehicles and back office operations.