Swindon-based specialist distributor The Connect Group has acquired a next-day delivery firm in a deal worth more than £113m.
Connect, formerly called Smiths News, said Sheffield-based The Big Green Parcel Machine Holding Company, whose principal subsidiary trades as Tuffnells Parcels Express, would contribute strongly to the group’s growth.
Connect is looking to diversify away from the traditional newspaper and magazine wholesaling business that formed its core when it de-merged from Swindon-based retail giant WH Smith in 2006.
Tuffnells, which was established 100 years ago, provides next-day B2B delivery, including parcels, bulky furnishings, building materials and automotive parts.
It operates from 34 depots and has a fleet of more than 930 vehicles and 800 trailers and containers serving 4,200-plus customers.
It had revenues of £138.5m to the end of August 2014 and adjusted earnings of £16m.
Connect chief executive Mark Cashmore said the deal offered “significant strategic and commercial opportunities for the enlarged group”.
“The addition of Tuffnells will see us broaden our reach into an area of specialist distribution which complements our core skills and competences of time sensitive distribution with high levels of service and efficiency,” he said.
“The transaction is expected to be significantly earnings enhancing for our shareholders and accelerates our clearly articulated diversification strategy. The group remains focused on growing profits and generating free cash flow to support our progressive dividend policy.”
