John Harvey recalls Tibbett & Britten’s (T&B) time in the car industry as a “great adventure”; he does not regret moving into the sector, but wishes T&B had exited sooner as he tells Justin Stanton.
Ultimately, the Ford contract forced Harvey to announce T&B’s first profit warning just two days after announcing the annual results in 1995, where the outlook had been bright.
“The analysts asked: ‘how deep’s the hole?’ and I said: ‘I have no idea.’ That spooked everybody. Again the analysts were fair; we all got castigated; they all said ‘bad luck, but we’re not in the bad luck business’,” he says.
Beginning of the end
T&B became infamous for its profit warnings, but as long as Harvey was in charge, T&B was safe, even from Exel, which under John Allan, was aggressive internationally and a significant rival. Indeed, it is a grim irony that one of the reasons for going into Mexico was strategic positioning to halt Exel’s sweep. According to Harvey, Allan said to him: “While you were there, we knew we could never get the company.”
Looking in the MT archives, it appears that Harvey announced his retirement in March 2004, but he corrects us: it was the City that announced his retirement, not him – and he suspects it was precisely to put T&B into play on the acquisition field.
He reveals: “I had two contenders for the chief exec role [with Harvey taking the non-exec chair role] and I planned to consolidate the position of the international business and then quietly slip away unnoticed.
“I was pissed off, still am [by the Exel take-over], but we had no one to blame but ourselves – we shouldn’t have done Mexico (MT 5 March).”
We talk further about Exel’s sudden takeover: Harvey reveals that Exel’s Allan had approached him earlier in 2004 suggesting a takeover, which he rejected, but “when the Mexican subsidiary went into loss with a subsequent fall in our share price, we were vulnerable and John and his advisors moved swiftly. They had done a lot of analysis of our business and on the Sunday during the World Cup, John rang to say they were putting a bid in the next morning.
“In the event, they deferred for 24 hours while we met our advisors. John and his finance director met [T&B chief executive] Mike Arrowsmith and myself, and we both excluded our advisors from the meeting. The next Monday we reached a deal, which was taken back to our respective boards the next day. This was conditional on a two-hour meeting where three or four key points of diligence were discussed and the offer went public on the Wednesday morning. It was a professional job, unwelcome, brilliantly executed and I would have done the same thing to him had the positions been reversed.”
The takeover effectively shelved Harvey’s plan to quietly walk away from the industry he had helped to shape: Allan wanted him to stay, but Exel had never gone down the joint venture route – the very route that had marked out much of T&B’s tremendous international expansion – so one of the first things Exel did when it took over T&B was to sell most of the JV interests.
While Harvey didn’t think much of this move at the time, it was crucial for the subsequent rebirth of the Tibbett name.
Many years before, Harvey had pushed T&B into the Balkans (operating from the Austrian HQ) to serve its key textile customers and to keep key rivals out. The move wasn’t entirely successful as T&B was up against some ‘Jack the lad’ rivals who played a, shall we say, faster and looser game.
In 2000, T&B’s Romanian business was franchised to Delamode. Subsequently, T&B joined Delamode in a jv, when it secured multi-
national retailer Metro’s business in Romania.
Come the later takeover of Exel by DHL, it was decided that the Romanian business, which included the JV with Delamode, was non-core. Meanwhile, Harvey had taken a 20% stake in Delamode via his post-T&B vehicle Keswick Enterprises. This had increased to 29% when, in 2010, Delamode and Keswick separated and Harvey bought the contract logistics businesses from both Delamode and DHL.
DHL never moved on from Exel Delamode, the successor company to Tibbett Delamode. Thus, in May 2011, Harvey rechristened Delamode Logistics as Tibbett Logistics, thereby resurrecting at least half of the Tibbett & Britten name.
It is evident that Harvey delights in using the Tibbett name in Romania, and we can only imagine the looks on a few faces in the industry when it reappeared. Harvey clarifies the name issue: “We can’t use the Tibbett name outside Romania; it is restricted to Romania.” He adds ominously: “But the business isn’t, and we trade under other names elsewhere.
“The Balkans is a high-risk investment area, and, if you look at Tibbett, we were always pioneers,” he states.
“We have identified the Black Sea as an area of future strategic value: Bulgaria and Romania are the first geographical ports of entry to the EC from the east. You’ve got Turkey, Russia and all the ’Stans around it. The roads in Romania are terrible, and the rail system has to be run carefully (a lot of multi-modal operators won’t run there). I trained as a medieval historian and it’s an obvious trade route: straight up to Bratislava, Prague, Vienna, etc.”
Already making waves
The business operates 400 trailers from nine DCs, providing 100,000m2 of warehousing; its customers stretch across many key sectors, including domestic and multi-national retailers, FMCG, and automotive. It is intermodal too, being the only private-sector operator of rail container terminals – with a pair in Bucharest.
Tibbett Logistics is already making waves: its chief executive David Goldsborough was named Most Efficient Logistics Manager at an awards event organised by Romania’s Tranzit magazine; and the business won the top prize from the Romanian Rail Industry Association in 2011.
MT’s view of the new business is simple: if you want to deliver into Romania or move goods through it, you have to deal with Tibbett Logistics.
And so, with a life well-lived and an industry-defining career behind him and yet still with a burning desire to face the next challenge, what’s Harvey’s secret? With the humility we’ve come to expect, he answers: “My skill is in joining up the dots; other people run the business; my job is spotting opportunities. That, and a very tolerant wife!”