Eddie Stobart sold
Eddie Stobart, the UK’s largest privately owned road haulage company, has been sold by its owner, Edward Stobart, to a real estate and railway maintenance business partly owned by his brother, William. The disposal comes after two years of losses which resulted in a new Managing Director being appointed in an attempt to turnaround the company.
The company has more than 1000 vehicles and 2000 employees with a turnover of around £150m (€219m). In 2002 it made a loss of nearly £1m (€1.46m) on its UK operations alone. However according to the management it is on course to make a profit in the current year. Although it is not clear exactly what role the new owners will play in the future of the company, at the very least they will be able to provide new capital for the company’s strategic development.
The UK road haulage industry is highly competitive, and many companies have found that they have been unable to pass on rising costs to their client base. Although many of the larger logistics companies have been protected to a certain degree through open book contracts and higher margin value added services, Eddie Stobart has operated within the cut throat commoditised section of the market. It also has a reputation for aggressive pricing which is likely to be one of the key reasons for its low profitability.