Takeover bid for Eddie Stobart

Published: 10 September 2019

Takeover bid for Eddie Stobart
Following recent events as shares were suspended at Eddie Stobart a few weeks ago, the company is likely to face takeover as the chief executive departs the company. Multiple firms have expressed interest, but among those who expressed interest in investing in Stobart’s was DBAY Advisors – who already have a 10% stake in the firm and would majorly benefit from the bid.

Firms have until October the 7th to enter a formal bid in the race for the firm, or decline a bid at all, under the rules of the stock market. Speaking on the matter, a spokesman on behalf of Stobart said: "There can be no certainty either that an offer will be made, nor as to the terms of any offer, if made. A further announcement will be made when appropriate."

Before any of the potential deals can be processed, a vote needs to be held by shareholders. With some of the stakes at almost 25% of the business. This would be a pivotal decider in the future takeover of Stobart.
Mr Woodford had to suspend his fund as the poor results from the most recent report made hundreds of the firm’s investors cash out, purchased a 20% stake in Stobart which floated in 2017 for 160p per an individual share.

As the suspension took place last month, the shares were as low as 70p – once a £2m accounting error by the bosses was revealed to the public eye. Profits were predicted to be “significantly lower” during Q1/Q2 than initially forecast. As this was the case, Chief Executive at the time Alex Laffey departed Stobart.
Speaking on handling the situation, the board of spokesmen on behalf of Stobart’s said they are planning a: "more prudent approach to revenue recognition, re-assessing the recoverability of certain receivables, as well as considering the appropriateness of certain procedures".

DBAY Advisors have engaged with Stobart for years, including during the firm’s flotation during 2017. At this time, Stobart Group (owners of Southend Airport) – sold its stake in the haulage side of the business.

While many businesses face an uncertain future at this time, Stobart is facing uncertainty for a very different reason to many other businesses – as the firm hopes to overcome their business woes and get back on track for shareholders’ expectations.
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