Friday, October 27, 2017

Fashion Freight Based Holding Company Buys European and Deep Sea Forwarding Specialist

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Shipping News Feature
UK – Xpediator, the holding company based in Braintree and set up a year ago by fashion freight forwarding and logistics operator Delamode, has continued its expansion policy with the acquisition of near neighbour, Italian and deep sea specialist Benfleet Forwarding. The buyout follows the purchase of Lithuanian based cross-border online delivery service platform in February, and the subsequent acquisition two months later of Easy Managed Transport Limited (EMT), another fashion industry forwarder.

Benfleet Forwarding, established in 1988, the same year as Xpediator’s original Delamode incarnation, has enjoyed steady growth since establishing its first local office and now employs around 40 staff spread across six offices in the UK, Italy and Romania. The company was identified as a target by Xpediator prior to its IPO as it was considered a natural fit given its wider portfolio of products and the opportunities for synergies within the group.

Benfleet will continue to trade as a stand-alone company and retain its corporate identity. The initial consideration payable on completion is £6.55 million comprising £3.95 in cash and £2.6 million in new Xpediator ordinary shares with a further figure up to £3.9 million in cash payable dependent on profits to March 2019. To year end March 2017 Benfleet Forwarding generated a revenue of £21 million with an operating profit of £1.73 million (£1.35 million after tax). Net assets then were £1.35 million with cash in the balance sheet approximately £2.47 million.

The deal means Xpediator will have over 650 staff operating from five UK sites with eleven more in Europe. News of the deal saw Xpediator shares rise 3p. It is proposed to admit over 9 million 5p ordinary shares to trading on AIM on November 1 at the London Stock Exchange. Xpediator’s total shareholding following admission will be 110,053,191ordinary shares of 5p. Stephen Blyth, Xpediator CEO commented:

”We know the Benfleet business well and we are confident it will be a commercially valuable and accretive acquisition for us. Benfleet shares our asset light approach to freight forwarding and will add significantly to our sea freight activities. Our client bases are similar but do not have significant overlap and while services are comparable our geographic focuses are different. Our strategy is to grow organically but also by acquiring smaller competing businesses which can enhance the group’s earnings and our services to new and existing clients.”

Benfleet has evolved from a small local operator to punch above its weight, particularly maintaining a strong presence in the Italian overland sector and ocean freight imports from Asia.