Independent British CEP carrier Business Post has announced that it will lose its five-year UKdistribution contract with FedEx as a result of the latter’s acquisition of ANC, a rival domestic
express parcels company.The contract represents 6% of its revenues, Business Post said. In the year ending March 31,2006, the company had annual revenues of GBP 278 million (EUR 414.6 million). This would give thecontract a value of about GBP 16.7 million (EUR 24.9 million).
Business Post said in a statement that it has been informed by FedEx of its intention toterminate the contract with Business Post as the Global Service Participant (GSP) in the UK.Although the timing has not yet been confirmed, Business Post expects this to be by September 2007.The contract, awarded in March 2006 and in effect since September 2006, was a renewal of theprevious five-year contract on similar commercial terms.
Business Post said it did not expect any impact on profits for the current financial year.
But the news sparked a sharp drop in the Business Post share price today. After closing at462 pence on December 18, the share fell by 27 pence (down 5.8%) to 435 pence in morning trading onthe London Stock Exchange.
