Struggling logistics company DX (Group) PLC (LON:DX.) has raised £24mln and turned to the founders of a business it bought five years ago to revive its fortunes.
Nightfreight founder Lloyd Dunn has been appointed as chief executive, while its other co-founder Russell Black joins as a non-executive.
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Both left Nightfreight in 2001 following a private-equity-backed takeover. DX (Group) acquired the business in 2012, when it became the group’s freight arm.
Dunn, a turnaround specialist, was then MD/chief executive at Tuffnells Parcel Express for nine years until it was sold in 2014 for £135mln.
In a statement today, Dunn said DX was an exciting opportunity and the refinancing was a critical step.
He, along with Black, Paul Goodson, another new non-exec, and chairman-elect Ron Series are putting up £5.25mln in a first tranche of the refinancing.
“Together with Russell Black and Paul Goodson, and alongside DX's major institutional shareholders, Gatemore and Hargreave Hale, we are pleased to be directly participating in this fundraising,” said Dunn.
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Major shareholder Gatemore will contribute the remainder of a £16.3mln first tranche of funding, while a special situation fund of wealth manager Hargreave Hale will put up the £7.7mln second tranche.
“The net funds raised after expenses will be used to meet DX's near-term material funding requirements, addressing its working capital shortfall, as well as capital expenditure and restructuring cost,” said the statement.
"These changes together mark a new chapter for DX and provide firm foundations for the turnaround of the Group,” said chairman Bob Holt, who will stand down once the financing and board changes are approved.
Shares rose 17% to 9.25p.