StockMarketWire.com - Talks over the potential combination of DX and the distribution division of John Menzies have been terminated.

A statement said that while the respective boards believed that the proposed combination had strong strategic logic for all stakeholders, the DX board has been unable to agree suitable terms.

As a result, it believed it to be in the best interests of DX shareholders to proceed with business transformation on a stand-alone basis.

It said this approach had the support of both DX's major shareholder and its bankers, with discussions on new financing options for DX already underway.

It said that as part of business transformation, the company intended to make a number of changes to strengthen the composition of its board and was in advanced discussions with individuals regarding potential new appointments.

It said these individuals were Ron Series, who was proposed as chairman designate, Paul Goodson, Russell Black and Lloyd Dunn, who were proposed as non-executive Directors.

Current chairman Bob Holt, Chairman would be leading these changes after which he intended to retire from the company. It said that as previously reported, DX expected to announce its full year results to 30 June in late September.

Trading in the company's shares remains suspended pending further notification. Holt said: "Our discussions with John Menzies have been constructive and the proposed combination of DX and John Menzies's distribution division was potentially highly attractive to both sets of shareholders.

"However, it has become clear that we would not be able to agree terms that would be acceptable to our shareholders and since we have a strong alternative business transformation plan in place, we have decided that it is the best interests of our shareholders for us to pursue this course.

"Our major shareholder and our bankers are supportive of the proposed plans for the business on a stand-alone basis and we have been exploring new financing options with our bankers.

"We also intend to strengthen the Board of Directors and are in advanced discussions with Ron Series to take the role of Chairman as well as with Paul Goodson, Russell Black and Lloyd Dunn as potential Non-executive Directors.

"We will make a further announcement on this in due course.

"As we were unable to agree suitable terms with John Menzies, we believe a stand-alone strategy is the right course for our shareholders and we are on the front foot with plans for business transformation and recovery."




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