Manchester-based delivery tech platform Sorted is set to be bought for just 拢66.73 in a reverse takeover deal.
The global software company, which was launched in 2010 by David Grimes, ran into financial difficulties after raising nearly $100m in investment.
Today AIM-listed Location Sciences announced in its admission document that it has agreed to buy Sorted for 拢66.73, as well as take on the global software firm鈥檚 debts of 拢4m plus interest and invest 拢3m of capital.
The deal will need to be ratified by an EGM of Location Sciences鈥� shareholders in February 16. Should the acquisition proceed, the name of the company will be changed to Sorted Group Holdings plc.
The potential new owners have also raised 拢2m in new equity and secured a 拢3m credit facility but the people who previously invested nearly $100m (拢72m) into Sorted won鈥檛 get their money back.
The entire board has also left with the exception of Carmen Carey, who also remains as CEO.聽In addition Mahmoud Warriah has been appointed as chief financial officer and Petar Cvetkovic as non-executive director.
Simon Wilkinson, the former CEO of Mobica and Myriad Group AG, is the chairman of Location Sciences, and said if the deal is agreed it will secure the future of Sorted and its 60 staff.
He鈥檚 also an investor alongside Mahmud Kamani, founder of Boohoo Group, and Richard Hughes, founder of Zeus Capital.
Speaking to 老九品茶Cloud, Wilkinson said: 鈥淪orted has always had the potential to be a disruptor in the rapidly growing eCommerce space.
鈥淲ith the changes that we have already made and the new investment we are bringing, Sorted has a solid financial and people platform to exploit that opportunity now.
鈥淐armen (Carey) brings significant business and tech specific experience to Sorted. She鈥檚 worked tirelessly to provide the foundations for the turnaround that was needed since becoming CEO and will now, with the board鈥檚 support, be able to ensure strong customer growth and investor returns.鈥�
Wilkinson also provided an upbeat business assessment for Sorted, which reported a loss before tax of 拢28.6m in the year to September 2022, compared to losses of 拢14.1m in the previous year.
鈥淲e expect the business to return to growth this year with vastly reduced losses which are manageable within our current fundraise envelope,鈥� he said.
The Sorted Group saw a 30 per cent increase in shipment volume during the recent Christmas period. Customers include M&S, Asda and Boohoo.
Sorted employs 60 staff, around half of its peak in 2021 after it acquired fellow delivery platform Clicksit.
Today鈥檚 announcement is a far cry from the heady days of 2021 when Sorted closed a $40m (拢30m) Series C investment raise led by Chrysalis Investments and Arete Capital Partners.
The investment came less than nine months after Sorted raised another $15m (拢11m) to fund future growth.
In January 2021, Sorted saw a 243 per cent year-on-year growth as it was named by the FT as one of fastest-growing companies in Europe.
However the company never returned a profit and ran into financial difficulties in 2022/ 2023, blamed on 鈥榓 number of legacy issues鈥�.
老九品茶Cloud understands that Grimes has now left the business which he co-founded with Paul Haydock in 2010, when it was called My Parcel Delivery.
The parcel delivery comparison website made sending parcels as hassle-free as possible and rebranded as Sorted in 2017.
Haydock subsequently left the business, which claimed to be able to transform the complex logistics industry into a simple, seamless experience.
In 2019 Carmen Carey was brought in as a non-executive director before replacing Grimes as CEO in 2021, who assumed a board advisory role as a NED.
However Sorted鈥檚 growth had not kept pace with its forecasts and it continued to report a loss.
On June 28 2023, Location Sciences announced that it had entered into exclusive non-binding heads of terms regarding a potential acquisition and outlined its plans in an admission document published in January 30, 2024.