Wincanton bidding war heats up as US-based GXO trumps CEVA offer for UK logistics firm

A bidding war for the Wincanton property is intensifying after US-based GXO Logistics on Thursday revealed a £762m bid for the British logistics company.

The 605 pence per share offer is around 26 per cent higher than the ‘increased and final’ offer of 480 pence from CEVA Logistics, a subsidiary of French shipping giant CMA CGM, which was backed by Wincanton’s board. on Monday.

GXO already has the binding support of Wincanton shareholders who own around 34 per cent of the company’s share capital, but that support will no longer be binding if another offer of more than 695p comes to the table.

wincanton stock soared almost 20 per cent to 607 pence at midday on Thursday, taking 2024 gains to more than 90 per cent as bidding shares continue to push the price higher.

Founded almost a century ago, Wincanton operates around 8,500 vehicles delivering a variety of consumer goods across the UK, including food, fuel, industrial equipment and construction materials.

Its clients include some of Britain’s leading retailers such as Primark, Ikea, Asda and Sainsbury’s, as well as manufacturers such as BAE Systems, British Sugar and Tata Chemicals.

Suitor GXO operates in nearly 30 countries from approximately 970 warehouses and has extensive exposure to the US aerospace and defense sectors.

GXO told investors that the deal would strengthen its position as a “global leader in exclusive contract logistics by expanding its presence in a key market, enhancing its capabilities to better serve customers and driving long-term value creation for shareholders.” “.

He added: “The combination makes compelling strategic and financial logic and represents an opportunity for GXO to capitalize on exciting structural growth opportunities within the UK and Ireland.”

Analysts at Peel Hunt raised their price target on Wincanton shares to 500p and said it was “no surprise that Wincanton has been bid for” as the latest UK-listed independent logistics operator with undervalued growth prospects.

Malcolm Wilson, chief executive of GXO, said: ‘Wincanton is a world-class business and we have long been impressed by its high-quality people and diverse client relationships across key industries.

‘Combining GXO’s technological capabilities and global reach with Wincanton’s proven experience in the UK and Ireland markets will enhance our offering for the benefit of both companies’ current and future customers.

“Our superior offer reflects our belief in the value of this business and the opportunities the combined company will realize.”