Barclay-owned Yodel rescued by Shift-led consortium

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Published Time: 13.02.2024 - 11:40:43 Modified Time: 13.02.2024 - 11:40:43

A privately funded consortium is buying the delivery company which serves Argos and merging it with industry rival Shift, Sky News can reveal

A privately funded consortium is buying the delivery company which serves Argos and merging it with industry rival Shift, Sky News can reveal.

City editor @MarkKleinmanSky

Tuesday 13 February 2024 07:08, UK

The collapse of Yodel, one of Britain's biggest parcel delivery groups, has been averted after an overnight rescue deal led by the founder of Shift, a rival operator.

Sky News has learnt that a newly formed company called YDLGP, which is backed by Shift executives and Solano Partners, a merchant bank, struck a deal early on Tuesday morning to buy Yodel.

The deal was struck on a solvent basis and without Yodel calling in administrators, as had looked increasingly likely in recent days, according to insiders.

It will be announced later on Tuesday, and is likely to safeguard thousands of jobs.

Yodel delivers parcels for customers including the food delivery service Gousto, Argos, Vinted and Very Group, the online shopping company owned by the Barclay familywhich also owned Yodel.

Sky News revealed last week that the Barclays, who have also temporarily regained nominal ownership of The Daily Telegraph, were accelerating efforts to find a buyer for Yodel.

The sale is expected to prevent Yodel's business descending into chaos and should shore up its customer base following uncertainty over its future.

It represents another significant deal for Jacob Corlett, Shift's founder, who last year engineered a swoop on parts of Tuffnells, another distressed logistics group.

As part of the deal, YDLGP is also acquiring Shift itself to create an enlarged British delivery powerhouse.

Yodel makes more than 190m deliveries annually from its 50 sites across the UK.

Last year, it generated £561.8m in revenue, adding clients including eBay and Boden.

In a statement issued to Sky News, Mike Hancox, CEO of Yodel, said: "We're extremely excited to begin the next chapter of Yodel's journey, leveraging the scale of our business with the support of new shareholders and the future benefits of the Shift technology platform.

"Our customers have always been our priority and the transaction announced today allows us to ensure continuity for them, as well as our employees and wider stakeholders."

Mr Corlett said: "I am incredibly proud of what we have built at Shift in the last few years, rapidly scaling our tech-logistics platform, and M&A has been a big part of that success.

"At the heart of this merger is Shift's revolutionary AI-driven technology platform, promising a future where efficiency and automation become the backbone of logistics operations."

Other operators, including The Delivery Group, had also explored bids for Yodel.

The value of the deal is unclear, and it remains uncertain how closely tied the proceeds will be to the security package taken by Gulf-based IMI over Barclay family assets as part of a deal for RedBird IMI to take control of the Telegraph newspapers and Spectator magazine.That transaction, which was triggered by RedBird IMI repaying a £1.16bn loan that the Barclays owed to Lloyds Banking Group in December, is now the subject of a government probe and fervent political and journalistic opposition to its completion.Half of the loan repayment was tied to the media assets, with the other halffunded solely by Abu Dhabi-based IMIsecured against other Barclay family interests.The tussle over the future of the Telegraph has nominally left the Barclays back in the status of owners once more, but without the ability to exercise any meaningful influence over the titles.In recent weeks, the newspaper group's chief executive, Nick Hugh, and finance chief Cormac O'Shea have left.

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