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The UK firm has a global customer base and encouraging growth prospects says analyst
Thursday 27 Apr 2017 Author: Lisa-Marie Janes

Logistics firm Wincanton (WIN) could be the next British company to be taken over by a foreign business, according to analysts.

‘We would argue that Wincanton is a potential takeover candidate given its market position, customer relationships, contract portfolio and attractive valuation. The recent devaluation of sterling could make it particularity attractive to an overseas buyer,’ says Canaccord Genuity analyst Gert Zonneveld.

‘Contract retention is high and annual revenue churn low, creating a solid revenue and profit stream with a high degree of visibility and relatively low volatility.’

Wincanton works for many well-known names in the food and drinks industry including Britvic (BVIC) and Sainsbury’s (SBRY).

‘We expect Wincanton to deliver solid, if modest growth in the coming years, in line with that of the broad UK logistics market,’ adds Zonneveld.

Net debt has been cut from £176.4m in 2009 to £32.2m as of 30 September 2016 following the disposal of non-core operations and improved cash generation.

Any suitor would also have to factor in Wincanton’s £169.2m pension deficit in their calculations.

At 278.25p, the business trades on 9.9 times forecast earnings for the year to March 2018.

Canaccord believes the shares could hit 322p over the next year. (LMJ)

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