Acquisitive Hays set for next pounds 100m buy

Hays, the logistics and business services group, is poised to expand its commercial services division with an acquisition of up to pounds 100m.

Speaking yesterday after the group announced its biggest acquisition to date, the pounds 93.4m purchase of two continental European logistics businesses from Australian transport group Mayne Nickless, Hay's chairman Ronnie Frost said the group's commercial division remained the focus of growth.

Hays was looking to add a new activity to the commercial side which includes high-margin businesses like mail order, billing and supplying surgeon's operating packs to hospitals.

Mr Frost quashed speculation that the group might consider a hostile bid for rival Christian Salvesen, having had its friendly approaches rebuffed last August. "It really has gone. I would have loved to do a deal if we had got a recommendation. But as soon as Salvesen went public, they killed it."

More such deals in logistics are likely over the next year, according to Mr Frost, including a move into Italy, possibly to support a French customer looking to expand, and later Spain. Hays is also looking to make a small acquisition, probably less than pounds 50m, in German food distribution to complement its Mordhurst business.

Though Hays has low gearing, Mr Frost emphasised the importance of finding the right opportunity.

Analysts were positive on this latest deal, but preferred to see the group expanding in faster growing areas. Andrew Ripper of Merrill Lynch said: "I'd rather they do this kind of small acquisition than buy Salvesen. Hays has performed well in distribution, but the logistics sector generally has been abysmal. If Hays were a pure logistics company and not in areas like personnel, they would not have such a good rating."

Mr Frost said the acquisition of FDS in France and the smaller Van der Heijden distribution business in Holland for pounds 72m cash plus debt would enhance earnings by around 3 per cent in the first year after pounds 5m integration costs, and with combined profits of pounds 8.8m and "substantial" growth prospects could add at least pounds 5m to profits. Prior to the acquisitions, analysts had pencilled in pounds 180m for the year to June 1998.

Mr Frost said that the new businesses, which have combined sales of pounds 150m were a good fit with the group's existing pounds 255m logistics operations in continental Europe. He said that adding FDS, which distributes non-chilled food and other goods to Hays' Frils business in France, which is mainly a chilled goods distributor, would offer customers in both businesses a greater choice.

Van der Heijden adds pounds 35m of sales to Hay's pounds 11m Dutch distributor, making the company a key player in Holland. Analysts said the strengthening logistics on the continent relative to the more difficult UK market, where margins have been under pressure from the supermarkets was positive.

Arts and Entertainment
The eyes have it: Kate Bush
music
Arts and Entertainment
booksNovelist takes aim at Orwell's rules for writing plain English
Arts and Entertainment
Al Pacino in ‘The Humbling’, as an ageing actor
filmHam among the brilliance as actor premieres two films at festival
News
Fifi Trixibelle Geldof with her mother, Paula Yates, in 1985
people
PROMOTED VIDEO
Sport
Mario Balotelli in action during his Liverpool debut
football ...but he can't get on the scoresheet in impressive debut
Environment
Pigeons have been found with traces of cocaine and painkillers in their system
environmentCan species be 'de-extincted'?
Arts and Entertainment
booksExclusive extract from Howard Jacobson’s acclaimed new novel
News
i100
Arts and Entertainment
A Pilgrim’s Progress is described by its publisher as “the one-and-only definitive record” of David Hockney's life and works
people
Sport
Loic Remy signs for Chelsea
footballBlues wrap up deal on the eve of the transfer window
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
News
i100
Arts and Entertainment
Art
Arts and Entertainment
Elizabeth McGovern as Cora, Countess of Grantham and Richard E Grant as Simon Bricker
TV
Life and Style
Instagram daredevils get thousands of followers
techMeet the daredevil photographers redefining urban exploration with death-defying stunts
Arts and Entertainment
Diana Beard, nicknamed by the press as 'Dirty Diana'
TVDaughter says contestant was manipulated 'to boost ratings'
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

C# .NET Developer (PHP, Ruby, Open Source, Blogs)

£40000 - £70000 per annum + Bonus+Benefits+Package: Harrington Starr: C# .NET ...

Data Analyst/Developer (Good education, Data mining, modelling,

£40000 - £70000 per annum + benefits+bonus+package: Harrington Starr: Data Ana...

Law Costs

Highly Attractive Salary: Austen Lloyd: BRISTOL - This is a very unusual law c...

Day In a Page

Alexander Fury: The designer names to look for at fashion week this season

The big names to look for this fashion week

This week, designers begin to show their spring 2015 collections in New York
Will Self: 'I like Orwell's writing as much as the next talented mediocrity'

'I like Orwell's writing as much as the next talented mediocrity'

Will Self takes aim at Orwell's rules for writing plain English
Meet Afghanistan's middle-class paint-ballers

Meet Afghanistan's middle-class paint-ballers

Toy guns proving a popular diversion in a country flooded with the real thing
Al Pacino wows Venice

Al Pacino wows Venice

Ham among the brilliance as actor premieres two films at festival
Neil Lawson Baker interview: ‘I’ve gained so much from art. It’s only right to give something back’.

Neil Lawson Baker interview

‘I’ve gained so much from art. It’s only right to give something back’.
The other Mugabe who is lining up for the Zimbabwean presidency

The other Mugabe who is lining up for the Zimbabwean presidency

Wife of President Robert Mugabe appears to have her sights set on succeeding her husband
The model of a gadget launch: Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed

The model for a gadget launch

Cultivate an atmosphere of mystery and excitement to sell stuff people didn't realise they needed
Alice Roberts: She's done pretty well, for a boffin without a beard

She's done pretty well, for a boffin without a beard

Alice Roberts talks about her new book on evolution - and why her early TV work drew flak from (mostly male) colleagues
Get well soon, Joan Rivers - an inspiration, whether she likes it or not

Get well soon, Joan Rivers

She is awful. But she's also wonderful, not in spite of but because of the fact she's forever saying appalling things, argues Ellen E Jones
Doctor Who Into the Dalek review: A classic sci-fi adventure with all the spectacle of a blockbuster

A fresh take on an old foe

Doctor Who Into the Dalek more than compensated for last week's nonsensical offering
Fashion walks away from the celebrity runway show

Fashion walks away from the celebrity runway show

As the collections start, fashion editor Alexander Fury finds video and the internet are proving more attractive
Meet the stars of TV's Wolf Hall... and it's not the cast of the Tudor trilogy

Meet the stars of TV's Wolf Hall...

... and it's not the cast of the Tudor trilogy
Weekend at the Asylum: Europe's biggest steampunk convention heads to Lincoln

Europe's biggest steampunk convention

Jake Wallis Simons discovers how Victorian ray guns and the martial art of biscuit dunking are precisely what the 21st century needs
Don't swallow the tripe – a user's guide to weasel words

Don't swallow the tripe – a user's guide to weasel words

Lying is dangerous and unnecessary. A new book explains the strategies needed to avoid it. John Rentoul on the art of 'uncommunication'
Daddy, who was Richard Attenborough? Was the beloved thespian the last of the cross-generation stars?

Daddy, who was Richard Attenborough?

The atomisation of culture means that few of those we regard as stars are universally loved any more, says DJ Taylor