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Marks and Spencer Group plc has announced the acquisition of Gist Limited, the principal contract logistics provider to M&S Food, from Storeshield Limited, a subsidiary of The BOC Group Limited.
Under the transaction, M&S has acquired the entire share capital of Gist for an initial consideration of £145m in cash. A further amount of £85m plus interest will be payable in cash from the proceeds of the intended onward disposal of freehold properties or, at the latest, on the third anniversary of completion.
M&S Food has entered new channels through the investment in Ocado Retail and through franchise partnerships, including over 2,500 Costa stores. The acquisition creates an opportunity to build a more efficient and effective supply chain through investment in the network to reduce the cost to serve, update legacy systems and improve automation.
Gist provides the majority of M&S Food logistics services via a network of eight primary and 10 secondary distribution centres located across the UK and the Republic of Ireland, including a number of freehold warehouses.
Through acquiring Gist, M&S can also take control of and invest in the network, building on the successful implementation of the “Vangarde” supply chain optimisation programme.
Stuart Machin, CEO, M&S, said: “M&S has been tied to a higher cost legacy contract, limiting both our incentive to invest and our growth. The last two years have shown what can be achieved by working collaboratively alongside our partners at Gist.
“This has given me confidence that now is the time to take action and remove an impediment to our growth. We have therefore acted decisively to acquire Gist, taking control of our Food supply chain for the first time in our history. This is the first step in a multi-year plan which will transform the entire supply chain.”
