Stobart Group Limited (LON:STOB) has said it will propose a name change before February 28, 2021, after selling the Eddie Stobart and Stobart trademarks and brands to Eddie Stobart Logistics PLC (LON:ESL) for £10mln.
The aviation and energy group said the payment will be split into a £6mln sum to be paid on completion of the transaction, £2.5mln to be paid on or before December 1, 2020, and £1.5mln paid 36 months after completion of the sale.
Stobart Group said the proceeds will be used for working capital purposes, adding that a number of its divisions will continue to use the brand for up to 36 months after completion of the sale which will be licenced on a royalty fee basis from Eddie Stobart.
The company added that the sale will also help investors to “more easily differentiate between Eddie Stobart's logistics business and Stobart Group's aviation and energy businesses through Stobart Group transitioning to a different name”.
"Stobart Group is proud of the brand it has built over many years. It is an iconic and highly recognisable name, associated with great customer service. However, the brand is primarily associated with the highly visible Eddie Stobart lorries. This has often created confusion for investors and other stakeholders between the Eddie Stobart Logistics business operations and Stobart Group's focus on developing a valuable London airport and a high margin energy business”, Stobart Group chief executive Warwick Brady said in a statement.
"By selling the brand now we can realise value for our shareholders and differentiate our businesses, establishing a new name that reflects our future in aviation and energy", he added.