Menzies Distribution / DX deal on brink of collapse?

In response to the police investigation at DX Group, the board of John Menzies do not appear amused. The company has released a statement saying that it is ‘considering its position’ in light of the allegations made to the City of London Police.

John Menzies board have stated that the board will “make a further announcement as and when appropriate”.

Just this week, the boards of John Menzies and DX Group announced that they had reached an agreement over a proposed merger between Menzies Distribution and DX. The deal is still subject to approval from the two companies shareholders and other controls as well.

The police investigation could well stymie the deal.

Earlier today DX issued this brief statement about the police probe:  “The Board of DX announces that it has been notified by the City of London Police Economic Crime Directorate (“City of London Police”) of an allegation that has been made against the Company which has resulted in the commencement of a preliminary investigation centred on the DX Exchange operations.

“The investigation is at a very early stage. The Board of DX received the details of the allegation on 7 June 2017 and is co-operating fully with the City of London Police.”

Given the drama and initial shareholder opposition to the deal, this police investigation will only add to the woes of DX that has been struggling financially in recent years. Apex Insight will report on the developments as they come.  
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