City Link assets sold to rival DX

The administrators of parcel delivery company City Link have sold more than £1m of assets to rival firm DX Group.

DX announced it had bought assets including scanners and cages as well as certain intellectual property for £1.125m.

The firm, which floated on the London Stock Exchange's Alternative Investment Market (AIM) last year for £175m, is run by the former managing director of City Link Petar Cvetkovic.

Mr Cvetkovic left City Link in 2009.

The DX chief executive said: "It is very sad that City Link has been unable to continue as a going concern, particularly for its employees and contractors.

"The administrators are now proceeding with an orderly sale of assets and we have made a limited investment to acquire certain assets.

"We are also doing all we can to provide opportunities for former City Link employees and contractors and to offer solutions to Customers who may need a new carrier."

City Link's administrators announced 2,356 job losses on New Year's Eve after rejecting an unnamed consortium's last minute offer to save the company.

The possible buyer "offered no money up front and significantly undervalued the assets to be acquired," the administrators said.

Business Secretary Vince Cable said the government had put measures in place to help the affected staff find new jobs.

The Coventry-based company was founded in 1969 and employed 2,727 people, but suffered years of losses.

City Link was bought by Better Capital for £1 in April 2013 but the administrators from Ernst & Young say the £40m the investment company put into the firm was not enough to turn it around.

Last week Jon Moulton, founder of Better Capital, denied the firm's collapse had been mishandled.

News of City Link's failure was announced on Christmas Eve, but he said the timing could not have been avoided and apologised to staff