SOUTHEND - 4
Sale of Controlling interest in Eddie Stobart Logistics
Stobart Group have announced that they are selling a controlling interest in their road haulage business for £280 million in order to, among other things, provide additional capital and reduce debt to near zero.
They will now concentrate on building the Air, Biomass and Rail divisions. The entry into new unserved European markets by Aer Arann is specifically mentioned, as is attracting new carriers to SEN.
They will now concentrate on building the Air, Biomass and Rail divisions. The entry into new unserved European markets by Aer Arann is specifically mentioned, as is attracting new carriers to SEN.
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I agree, although rail is a great way of getting money from the taxpayer! Let's hope Stobart haven't caught the aviation bug and lost their sense of reality. They seem to be doing fine at the moment, but this is a leap in the dark. I wish them all the luck in the world, but I'd echo Sergeant Wilson's word to Captain Mainwaring, "Do you think that's wise, sir?"
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Stobart sale
The key fact about this sale of the truck business is that it is to a group headed up by William Stobart. It seems the Stobart boys are sticking to trucking and Andrew Tinkler wants to play with trains and planes. Also interesting is that the truck division has minimal debt whilst the remaining trains, planes and bio business carries the debt burden.
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The Board of Stobart Group Ltd has announced a partial sale of its Transport and Distribution Division, to enable it to focus on its Infrastructure and Support Services Divisions and invest further in the Group's air, rail and biomass businesses.
The Transaction will position the Group to repay substantially all of its debt, accelerate the growth of the Continuing Group and buy back a proportion of its shares.
Stobart Group proposes to realise 51% of Eddie Stobart Logistics, the holding company of the parts of the Transport and Distribution Division being sold. The Transaction values the business being sold at approximately £280.8 million.
The third son of founder Eddie Stobart, William, will now head the spun-off Eddie Stobart Logistics.
The Stobart Group aims to focus on passenger growth at its London Southend and Carlisle Lake District airports, capitalising on demand for regional airport capacity in London and the South East and the UK as a whole
The Transaction will position the Group to repay substantially all of its debt, accelerate the growth of the Continuing Group and buy back a proportion of its shares.
Stobart Group proposes to realise 51% of Eddie Stobart Logistics, the holding company of the parts of the Transport and Distribution Division being sold. The Transaction values the business being sold at approximately £280.8 million.
The third son of founder Eddie Stobart, William, will now head the spun-off Eddie Stobart Logistics.
The Stobart Group aims to focus on passenger growth at its London Southend and Carlisle Lake District airports, capitalising on demand for regional airport capacity in London and the South East and the UK as a whole
The FT (in its own unique way) was really quite rude about the trucking sell-off and made clear their strong disapproval. Definitely worth having a look at the 2 articles in the FT on this via Google for some entertainment.
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Yes, I particularly like:
Full article here.
The impression is of a private equity business with a stock market listing. Minorities who reckon anything goes will stick around for the mind-blowing happening that turns Stobart Group into a mini-conglomerate marginally better focused on biomass and aviation. Squares will make excuses and leave the freak-out.
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In my opinion more focus on a specific area of the Stobart business is a good idea, and this should result in a positive out come for SEN. I think what you have to remember also is that Stobart have hired experienced staff to work to try and entice airlines in (such as Paul Haynes from STN), and that we don't have Mr. Tinkler as head of negotiations!
Also does anyone have information on why 3 BinAir metros have suddenly been operating at SEN and where to/who for?
Also does anyone have information on why 3 BinAir metros have suddenly been operating at SEN and where to/who for?
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Airports are a bit like football clubs. You can plough a lot of money into them but only a few will give you a decent return. I can't see easyjet giving Stobart much of a profit if any and it will only be a matter of time before Southend is sold off.
Stobart will be remembered as the company that had the vision to develop Southend but developing an airport and making a profit are two different things.
Stobart will be remembered as the company that had the vision to develop Southend but developing an airport and making a profit are two different things.
While I find the Stobart strategy of selling 51% of its transport business hard to understand, it will certainly focus their attention on developing SEN more vigorously. I believe that it is, in fact, less likely that they will sell SEN as it has now become part of their core business and can no longer be treated as a 'trophy' as someone recently described it to me
Obviously the current reliance on easyJet is a problem. albeit giving a nice platform from which to solve the problem, but this Summer may well see a considerable broadening of the SEN route network adding to its attractiveness to the market.
Obviously the current reliance on easyJet is a problem. albeit giving a nice platform from which to solve the problem, but this Summer may well see a considerable broadening of the SEN route network adding to its attractiveness to the market.
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Stobart has already admitted that Southend has limited expansion potential due to constraints not only physical but as laid out by Southend council. Stobart would need to diversify by buying other airports with borrowed money.
I would not be surprised that Stobart does not have a hidden agenda to sell the airport in maybe 2 to 5 years time. Nothing wrong with that but you only need to look at some of the airport owners in this country to see how things can take a turn for the worse under the wrong ownership.
I would not be surprised that Stobart does not have a hidden agenda to sell the airport in maybe 2 to 5 years time. Nothing wrong with that but you only need to look at some of the airport owners in this country to see how things can take a turn for the worse under the wrong ownership.
I really cannot see Stobart buying any other airports in the foreseeable future. One of the main reasons for selling part of the transport business was to greatly reduce borrowings, so they are hardly going to take on another debt burden in a hurry.
Yes of course there are constraints on the expansion of SEN as there are at nearly all airports, LTN included, but currently only 50% of the movement cap limit is used and there is no Southend Council limit on passenger numbers. It should be remembered that until the terminal extension was opened late last month SEN was capacity constrained at times with its current level of activity, so it wasn't in a position to go in search of another major user. I know for a fact that last year one such user approached SEN and they were told that their planned programme could not be comfortably accommodated so could they start with a 'toe in the water' operation. They declined to do that. The SEN response to something similar today would be entirely different of course.
Yes of course there are constraints on the expansion of SEN as there are at nearly all airports, LTN included, but currently only 50% of the movement cap limit is used and there is no Southend Council limit on passenger numbers. It should be remembered that until the terminal extension was opened late last month SEN was capacity constrained at times with its current level of activity, so it wasn't in a position to go in search of another major user. I know for a fact that last year one such user approached SEN and they were told that their planned programme could not be comfortably accommodated so could they start with a 'toe in the water' operation. They declined to do that. The SEN response to something similar today would be entirely different of course.
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More rubbish.............
Southend Airport set for funding boost following Stobart sale (From Echo)
I particularly enjoyed the bit about "Aer Lingus owner Aer Arann".
Southend Airport set for funding boost following Stobart sale (From Echo)
I particularly enjoyed the bit about "Aer Lingus owner Aer Arann".