Struggling logistics firm DX (Group) PLC (LON:DX.) has sold some property and arranged a short term loan with major shareholder Gatemore to cover a short-term cash crunch.
In a statement, DX said it had identified a ‘near term material funding requirements over and above the company's existing resources’ due to recent weak trading.
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To fill this gap, it has sold and leased back the company's sites at Thatcham, Basildon, Rotherham, Northampton (Kyoto Close) and Nottingham (Woolsthorpe Close) for £4.5mln.
In addition, shareholder Gatemore Capital has lent the company an unsecured £2mln.
The funds will pay back a £5.8mlm term loan with HSBC and provide working capital while talks over extending its invoice discounting facility and a wider refinancing continue.
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Liad Meidar, managing partner at Gatemore said the additional funds would pay down DX’s HSBC's term loan while retaining the freight hub in Willenhall.
“This gives the company greater financial and operational flexibility, setting the stage for the refinancing.
“We expect to roll our loan shortly into the new financing, positioning DX with a healthy balance sheet and a new start under proven leadership."
Over the past year, DX has issued a number of profits warnings, changed its senior management and abandoned a planned merger with John Menzies’ distribution business.