Wednesday May 17, 2023

FRP advises on switch to employee ownership

We’re pleased to have been an adviser on a deal that has seen Cardinal Global Logistics transition to an employee-ownership model – making it the biggest employee-owned company of its kind in the world.

Launched in Eccles in 1998 with a £15,000 business loan, Cardinal has since blossomed into an international firm with more than 40 offices, 6,000 clients and revenues exceeding £500 million.

It is now celebrating its quarter-century in business by joining the growing number of employee-owned businesses, with around 1,000 similar models currently operating in the UK today.

Cardinal’s democratisation model means every member of staff now gets to share in the profits that the company generates each year.

In addition to financial benefits, employees will have input regarding the future direction of the Cardinal Partnership, which includes the Far Logistics and Cardinal Global Logistics brands.

This move also represents an effort to preserve the employee-first company culture that Cardinal has worked hard to establish over the past 25 years. The group has earned recognition in the logistics sector for its tech-powered approach, transparency, innovation and determination to deliver exceptional service and value.

Our Restructuring Advisory team, led by Partner Anthony Collier and Director David Bonner, provided financial due diligence to support the funder on the transaction.

Brian Hay, CEO of The Cardinal Partnership, said: “Our decision to become an employee-owned business will be transformational. We believe that excellence and dedication should be rewarded, and we have some of the most talented operators in our industry.

“During our first 25 years as a business, we have been able to take the company from a £15,000 investment to one of the UK’s most respected and sizable logistics businesses. Undoubtedly, this transition will allow us to take our business to the next level and I’m looking forward to what’s to come.”

Anthony Collier, Partner at FRP, said: “Employee ownership trusts have become an attractive succession tool for business owners and employees alike as they can help maintain a company’s culture while fostering greater engagement and productivity.

“Our team assessed all the relevant information that stakeholders needed to support their decision making, and we were proud to support Cardinal Global Logistics and HSBC UK with this transaction. Cardinal Global Logistics can now start a new chapter in their story with confidence, and I’m sure they have another 25 years of success ahead of them.”