Wincanton walks away from TDG bid

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The Independent Online

Wincanton, the UK road haulage group that has contracts with companies including Marks & Spencer and Homebase, has walked away from a £233m bid for rival TDG.

TDG remains in talks with another suitor – the private equity group Laxey Partners – but investors and analysts fear that a firm bid is now unlikely to emerge before Friday's deadline.

Wincanton yesterday announced it had "concluded that it is not in the best interest of Wincanton shareholders to proceed with an offer for TDG". It gave no reasons for pulling out, but it is understood that the company encountered problems over the earnings enhancement of a potential deal and worried about the risk of the transaction after carrying out due diligence.

Douglas McNeill, an analyst at Blue Oar, said: "Wincanton was duty-bound to look at TDG once Laxey had put it in play, but has either found more limited scope for synergies than it thought, or concluded that financing simply wasn't available in current markets".

TDG's share price plunged by as much as 10 per cent yesterday on the news. Wincanton's rose oby more than 5 per cent.