M&S buys logistics firm Gist as it seeks food supply chain control

Marks & Spencer has sealed a deal worth up to £255 million to buy its logistics services provider Gist in an effort to take greater control of its supply chain.

The food and clothing giant has agreed to buy the business, which is an operator for M&S Food’s logistics, from Storeshield, a subsidiary of BOC Group.

M&S will pay an initial £145 million for the business, followed by a further £85 million plus interest on the third anniversary of the move’s completion.

It will also be due to pay up to £25 million more, plus interest, “under certain conditions”.

The retailer said Gist provides the majority of M&S Food logistics services through a network of eight primary and 10 secondary distribution centres across the UK and Ireland.

Stuart Machin, chief executive of the retailer, said: “M&S has been tied to a higher cost legacy contract, limiting both our incentive to invest and our growth.

“The last two years have shown what can be achieved by working collaboratively alongside our partners at Gist.

“This has given me confidence that now is the time to take action and remove an impediment to our growth.

“We have therefore acted decisively to acquire Gist, taking control of our food supply chain for the first time in our history.”

The announcement came hours after the retailer confirmed that its finance chief is to leave to join Associated British Foods (ABF), the consumer group behind Primark.

Eoin Tonge is set to take over from ABF’s retiring finance chief John Bason by “no later than February 2023”.

It came only weeks after M&S confirmed that Mr Tonge would take on new responsibilities, as chief of strategy alongside his finance role, as part of a wider leadership shake-up at M&S.

M&S said Mr Tonge will support the business through its interim financial results in November, and it has started the process to find his replacement.

Archie Norman, chairman of M&S, said: “Eoin has made a great contribution to the transformation of M&S, bringing quality and rigour to the finance function and building a very strong team.

“Our financial controls, reporting and financial discipline are in a far stronger place than when he arrived.”