REG - Logistics Dev Grp - Investment into platform to acquire APC

Logistics DevelopmentAnnouncement

18/07/2025 16:15

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RNS Number : 7337R  Logistics Development Group PLC  18 July 2025

18 July 2025

Logistics Development Group plc

 ("LDG" or the "Company")

Investment into platform to acquire The Alternative Parcels Company

LDG announces an investment of £15 million into Framtid TopCo Limited
("TopCo"), a private holding company of a group of companies (the "Group")
formed by DBAY Advisors Limited ("DBAY"), the Company's investment manager.
The Group has agreed to acquire a 78.32 per cent. interest in The Alternative
Parcels Company Ltd ("APC"), the UK's largest independent parcel delivery
network (the "Acquisition").

Transaction Summary and Strategy

LDG, through its wholly owned subsidiary, Fixtaia Limited, is subscribing £15
million (the "Investment") for a resultant 64.1 per cent. interest in the
shares in TopCo, through a subscription for non-voting class B shares.

TopCo, through a wholly owned subsidiary, is acquiring a 78.32 per cent.
interest in APC which will result in LDG having a 50.2 per cent. economic
interest in APC on a look-through basis. DBAY will own all the voting shares
in TopCo. Almost all of the existing APC shareholders and management team will
retain a significant minority stake in the APC business.

TopCo, through a wholly owned subsidiary, has today entered into a share
purchase agreement in relation to the Acquisition.  In addition, it has
entered into a shareholders' agreement and a call option to acquire the
minority stake in the APC business retained by existing APC shareholders and
management.  The call option uses the same EBITDA valuation multiple as the
Acquisition.

A new senior debt facility of £30 million has been put in place by the Group
to support the Acquisition.

The Acquisition was completed today.

LDG's initial economic interest in Topco is calculated immediately following
the Acquisition and may be subject to dilution from subsequent acquisitions,
if completed, under the DBAY strategy set out in more detail below.
 Shareholdings may also change if additional equity is raised by Topco and
there is no certainty that LDG will participate in subsequent acquisitions or
fundraises.

In addition to DBAY and LDG, the other investors in Topco include WS Investco
Limited ("WS Investco"), led by Mr William Stobart, which will hold a
significant minority stake in the Group upon the closing of the Acquisition.

The Investment is in excess of the threshold for individual investments (10
per cent. of NAV) set out in the Company's investing policy, therefore DBAY
has sought and obtained LDG Board approval for the Investment and the
Acquisition.

APC

APC is the largest independent parcel delivery network in the UK. The network
processed over 30 million parcels in the fiscal year ending 30 March 2025.

APC sets itself apart from competitors by the strength of its unique network
structure. The first and last mile is operated by its 90+ locally concentrated
depots owned by entrepreneurial network members, which allows them to provide
quicker response times and more tailored customer service. APC is focused on
overnight delivery with a particular strength in niche parcels including
fragile, liquid and high-value parcels.

For the year ending 31 March 2024, APC reported operating profit
(pre-exceptionals) of £7.1 million, an 8.9 per cent. increase on the prior
year, on revenues of £126.1 million. APC's audited accounts for the year to
31 March 2024 show group net assets of £48.9 million.

DBAY's Group Investment Strategy

Following a series of successful investments in the logistics sector, DBAY is
now pursuing the strategic vision to create a new national transport and
logistics platform in the UK. The acquisition of APC, one of the leading
next-day delivery parcel networks focused on specialised parcels, marks the
initiation of this strategy.

William Stobart will lead the Group as Chief Executive Officer. William brings
over 40 years of experience in the UK transport and logistics industry. He has
played a key role in some of DBAY's most successful logistics investments,
including the carve-out of Eddie Stobart from Stobart Group plc in 2014 and
the turnaround of Eddie Stobart Logistics in 2019, following the listing of
the company in 2017. William was instrumental in transforming Eddie Stobart
from a regional operator into a UK market leader in transportation and
warehousing. Over the last 11 years, he has successfully built a group of
logistics companies, that specialise in logistics for the construction
industry and high & heavy haulage.

DBAY is also in exclusive discussions to acquire William Stobart & Son
Limited from WS Group, which specialises in general road haulage and
warehousing for FMCG and consumer markets. David Pickering, former CEO of
Eddie Stobart, has joined William Stobart & Son Limited as CEO. He brings
operational expertise and a strong track record in managing large logistics
networks.

LDG Concert Party

Mr William Stobart, who owns 3,889,844 ordinary shares of £0.01 each in LDG
("Ordinary Shares"), representing approximately 0.94% of the Company's issued
share capital, is the controller of WS Investco and was historically a member
of the DBAY concert party. Consequently, he is now deemed to have rejoined the
DBAY Concert Party (as described in LDG's circular dated 28 March 2025). The
aggregate Concert Party holding now comprises 145,507,226 Ordinary Shares
representing 35.16% of the Company's issued share capital.

Related Party Transaction

TopCo is an associate of DBAY, which, as LDG's investment manager and 27.41%
LDG shareholder, is a Related Party to LDG pursuant to the AIM Rules.
Accordingly, the Investment is being treated as a Related Party Transaction
pursuant to AIM Rule 13 and the independent directors (being the LDG directors
excluding Colin Kingsnorth), having consulted with Strand Hanson as the
Company's nominated adviser, consider the terms of the Investment to be fair
and reasonable insofar as the shareholders are concerned.

For enquiries:

 Logistics Development Group plc     Via FTI Consulting

 FTI Consulting                       +44 (0) 20 3727 1340

 Nick Hasell

 Alex Le May

 Strand Hanson Limited               +44 (0) 20 7409 3494

 (Financial and Nominated Adviser)

 James Dance

 Richard Johnson

 Abigail Wennington

 Investec Bank plc                   +44 (0) 20 7597 5970

 (Broker)

 Gary Clarence

Harry Hargreaves

 

This announcement contains inside information as defined in Article 7 of the
EU Market Abuse Regulation No 596/2014, as it forms part of United Kingdom
domestic law by virtue of the European Union (Withdrawal) Act 2018, as
amended, and has been announced in accordance with the Company's obligations
under Article 17 of that Regulation.

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