Wincanton expands presence with Hanbury Davies buy

Wincanton has moved into the container market with the £25m purchase of Hanbury Davies. The supply chain logistics provider started its own container operations about a year ago and had about 30 vehicles based in Alconbury and Southampton. The addition of Hanbury Davies will add some 500 vehicles and 21 sites to the operation. Wincanton managing director Martin Taylor says: "We discovered early on [in our container business] that you need critical mass when moving containers 20-30 vehicles is not really enough to cover the whole of the UK."

Once Wincanton started looking for an acquisition target Hanbury Davies was the clear winner because there was a clear fit between the two, Taylor adds. Hanbury Davies will now be run under the Wincanton brand and its management team will take on responsibility for developing Wincanton's existing container business. The container market is growing at 10-11% a year, Taylor reports - he predicts that Wincanton will achieve strong organic growth on the back of this growth.

Hanbury Davies MD Ian Wilson will continue to head up the operation. He admits the company was not actively looking for a buyer when Wincanton made its initial approach but says: "Wincanton is very progressive about what it wants to do in the sector and very focused and committed to achieving its goals and we felt the companies are a very good cultural fit." He adds that this is an exciting time for staff and management as Wincanton wants to continue the growth plan Hanbury Davies had been working to.

David Pattison, senior analyst at Plimsoll Publishing, says Hanbury Davies has been expanding rapidly and will give Wincanton a superb platform on which to develop its presence in the container market. "The container market is a growth area and I think [Wincanton] will be looking to invest in it and develop the business," he predicts. Wincanton may have to pay a further £2.5m if Hanbury Davies performs well in the next financial year. In the 12 months to 31 March 2007 its container activities generated turnover of some £52m with pre-tax profits of £4.3m.

l In an interim management statement to the City Wincanton says trading in the first half of its fiscal year to 21 January has been in line with expectations. "Strong momentum of our UK and Ireland business has continued into the second half and improved first half performance in mainland Europe is also being sustained," it claims. The statement also revealed that a number of further acquisition targets remain under review in the UK, Ireland and mainland Europe.