Menzies cashes in after completing major sale
Menzies Distribution has completed the sale and leaseback of eight distribution depots across its UK logistics network for £24.65 million.
The properties are located in local industrial areas in Aberdeen, Edinburgh, Glasgow, Ipswich, Norwich, Stockton on Tees, Swansea and Weybridge. They are part of Menzies Distribution’s UK wide network of 55 depots.
The purchaser of the property portfolio is Custodian REIT plc, a UK real estate investment trust, which listed on the main market of the London Stock Exchange on 26 March 2014. Its portfolio comprises properties predominantly let to institutional grade tenants on long leases throughout the UK.
The sale and leaseback of the eight distribution depots will align these properties with the company’s remaining 47 leased properties across the UK & Ireland providing a consistent and flexible network of operating bases supporting the long-term growth and diversification of the company.
Paul McCourt, Chief Financial Officer of Menzies Distribution, commented on the transaction: “In January 2019, we announced a new 5-year Revolving Cash Facility with RBS amounting to £25 million which has yet to be utilised. With the continued profitability of the company since its sale from John Menzies plc in September 2018, and the generation of a further £25 million in cash proceeds from this latest property transaction, the company has built a strong balance sheet to support our continued growth ambitions both organically and through acquisition.”
Greg Michael, Chief Executive Officer, commented on the transaction: “Since our acquisition by private equity firm Endless LLP in September 2018, the company has invested heavily into the retail logistics and parcel delivery markets. In July 2019 the company opened its new 170,000 sqft super-hub in Coventry which, together with its existing 55 depots, has given Menzies Distribution a market leading national footprint, covering from the highlands of Scotland through to its 100 strong electric vehicle fleet in central London.
This transaction is a further positive step forward for Menzies Distribution, which will support and accelerate our continuing strategic and operational diversification over the coming months”
