The battle for control of Eddie Stobart has pitted the son of its founder against his former brother-in-law.
William Stobart, son of 90-year-old Eddie, is backing a £55m rescue deal launched by secretive private equity firm Dbay Advisors to save the troubled haulier.
But Andrew Tinkler, who was the firm’s chief executive until 2014, wants to be reinstated as boss and lead his own £80m deal to bring the lorry firm back from the brink of collapse.
Battle lines: William Stobart (bottom right) and Andrew Tinkler are fighting for Eddie Stobart
The pair, who were previously married to sisters but have both since divorced, locked horns yesterday as the battle turned increasingly acrimonious.
Tinkler, 56, talked down Dbay’s plans as ‘hypocritical’ and said his own offer for Eddie Stobart was ‘materially better on multiple fronts’ for the company’s shareholders and other stakeholders.
In a sign of the increasingly bitter rivalry between himself and 58-year-old Stobart, he also reported Dbay to the Takeover Panel in an attempt to prevent the firm – which is Eddie Stobart’s biggest shareholder – voting on its own rescue bid.
Dbay, which if successful is planning to reinstate William Stobart as executive chairman, hit back, claiming Tinkler had been ‘unable or unwilling to submit any concrete workable alternative so far’.
Dbay wants to acquire 51 per cent of Eddie Stobart’s operating businesses and inject £55m through loans to help it keep trading. Current shareholders would be left with just 49 per cent, meaning their shares would tumble in value. Tinkler, however, wants to raise £80m by selling new Eddie Stobart shares.
The battle for Eddie Stobart began earlier this year when the haulage company admitted it had found an enormous black hole in its finances after an error was found in the 2018 accounts.
It has since said profits for this year will be just £2m, while debt will be around £200m.
This means Eddie Stobart’s debt pile is at least 100 times larger than its profits – for a normal company, this ratio should be less than ten times.
Dbay’s plan is the only one which has the backing of Eddie Stobart’s board and, vitally, its lenders, which are keeping the company afloat by waiving certain debt repayments.
Shareholders are due to vote on the Dbay deal on Friday, but many are furious that the proposal will practically wipe out the value of their stock.
If they turn it down, Eddie Stobart could plunge into administration just weeks before Christmas – leaving clients such as Tesco, its biggest customer, in the lurch during its busiest time of the year.
Dbay warned yesterday that if shareholders did reject its offer it would seek to take control of Eddie Stobart via a so-called pre-pack administration, which would not require their consent.
Dbay already owns 29.9 per cent of Eddie Stobart, so needs only another 20.2 per cent of shareholders to side with it in order to cross the 50 per cent threshold and push through its original plan.
Tinkler’s complaint to the Takeover Panel is likely to fall on deaf ears, as the Mail understands the regulator has no jurisdiction over this type of deal.
Dbay’s rescue bid has also been recommended by shareholder advisory firms Pirc, Glass Lewis and ISS.
Shares in the company suspended trading in August at 71p as it tried to iron out its accounting issues.
Dbay and Tinkler have been buying shares off-market since, at about 6p each, meaning their value has plunged more than 91 per cent in just four months. Many of the shares have been acquired from the administrators of Neil Woodford’s funds, after he was ousted as manager. Woodford Investment Management, the firm run by the fallen stockpicker, was the largest shareholder when Eddie Stobart’s shares suspended this summer.
The tumbling value of the shares will mean yet more pain for savers who kept their money with Woodford before his collapse.
Tinkler said Dbay’s move to buy cheap shares was ‘wholly hypocritical, given that its proposal does not afford any meaningful value to other shareholders’.
Eddie Stobart’s lenders are understood to be impatient with the ongoing upheaval and are keen that the Dbay deal goes through on Friday.
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