Struggling trucking firm Eddie Stobart held a crunch meeting on Friday to decide its future as shareholders vote on a rescue deal that could protect up to 6,500 jobs.
The company, which has become a household name thanks to its distinctive green lorries and a popular Channel 5 documentary series, is struggling under £200m of debt and faces administration unless new funding can be secured.
Shareholders are voting at an emergency meeting today on whether to accept £55m high-interest loan from private equity firm Douglas Bay Capital Fund (Dbay) in exchange for a controlling stake in Eddie Stobart.
The Unite union denounced the proposal as “bandit capitalism” and accused Dbay of exploiting Eddie Stobart’s vulnerable financial position.
“DBay is involved in an elaborate game of smoke and mirrors,” said Unite national officer for road transport Adrian Jones.
“DBay, and the management of ESL are claiming that Stobart is at risk of imminent collapse but no one can make their own view as the company has not published any data on its cash position since the publication of the 2018 annual results.”
According to Unite, Dbay’s proposal primarily serves to pay back lenders and cover Dbay’s own fees, rather than investing in Eddie Stobart’s long-term future.
Former Stobart chief executive Andrew Tinkler has put forward a rival package that would raise £80m from shareholders as well as a £20m bridging loan. Mr Tinkler has said investors support his plan but Stobart’s board rejected it as “misleading” this week.
Lenders are “wholly supportive” of the Dbay proposal and will not entertain any other offers which do not pay back Eddie Stobart’s lenders in full, the board said.
“Once in place, the financing will safeguard jobs for Eddie Stobart’s employees and secure delivery of the reliable, high-quality services its customers rely on across the busy Christmas period,” the board said in a statement.
Mr Tinkler told PA news agency on Friday: “The meeting’s finished but we are still waiting to find out. We’ll watch for the RNS (Regulatory News Service) update.
“To be fair, the meeting was all pretty calm and they just went over the two proposals again, explaining what they mean to investors.
“I just want to bring stability to the company. The important thing now is getting a deal sorted for the 6,500-odd staff and I’m hopeful we’ve got what it takes to take the company forward.”
If the deal is rejected the company could be put into administration, with Deloitte reportedly lined up to manage the process.
It would mark a sharp demise for Eddie Stobart which has managed to turn a logistics company into a much-loved brand with its own range of clothing and a cult following of truck spotters.
The company’s shares were suspended in August after the discovery of a £2m accounting hole. Rival haulage firm Wincanton had expressed an interest in investing in Eddie Stobart but pulled out last week.