GXO Logistics Steps Up Bidding War for Wincanton

Wincanton shares jumped 20% to 609 pence in trading at midday Thursday. Over the past 12 months, shares were up 95%.

Wincanton declined to comment on the new offer. Ceva said it was considering its options and that it had four business days to decide whether to increase its bid.

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

GXO said it received commitments to vote in favor of its offer from Wincanton shareholders with stakes totaling 34%. Their support will cease to be binding if an offer of more than 695 pence a share arises, the company said.

GXO’s offer came after Wincanton’s board earlier this week agreed to an improved, final offer from Ceva of about $764.3 million, which was raised from an initial bid of about $716.5 million in January following an approach from GXO. Wincanton earlier this week said it was considering a rival proposal and that was sticking with its recommendation of Ceva’s bid.

Wincanton is the largest contract logistics provider based in the U.K. by revenue, according to Statista, but has seen earnings falter recently amid a broader downturn in global trade and in the country’s transportation and logistics sector. The company reported about $878 million in revenue in the six months ending Sept. 30, 2023, down 7.8% from the same period the year before, and pretax profit fell 26% to about $24.1 million.

The company’s customers include large retailers and industrial operators, including furniture merchant IKEA, apparel seller Primark and 

French container shipping giant CMA CGM has used its Ceva Logistics business, which it acquired in 2019, to spread its reach beyond ocean trade. Separately on Thursday, CMA CGM said it had completed the purchase of France’s 

Thomas Cullen, an analyst at U.K.-based logistics research firm Ti Insight wrote in a report this week that it is “a little surprising that such experienced buyers of companies as CMA CGM and GXO are willing to pay so much for a company that is presently driven by the growth of the British retail market. They must be seeing substantial, unrealized value in Wincanton.”