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Shift, which was set up in 2017, agreed to rescue Yodel last year but the deal unraveled a few months later. Now, Yodel is suing the company and founder Jacob Corlett in London’s High Court, claiming in filings that he “systematically stripped its assets and misappropriated its money.”

The 30-year-old denies the allegations and is counter-suing for £10 million ($12.2 million) in unpaid fees.

The legal wrangling is playing out against a backdrop of deal-making across the British parcel delivery industry, which enjoyed a surge in demand during the COVID-19 pandemic but suffered in the aftermath as costs soared with inflation.

Last year, Apollo Global Management Inc. agreed to buy Evri Ltd from private equity rival Advent International, while Royal Mail’s parent International Distribution Services Plc agreed to a £3.6 billion takeover by Czech billionaire Daniel Kretinsky.

The battle for Yodel, which in August secured £85 million in funding backed by supplier PayPoint Plc, isn’t over. Sky News reported Thursday [Jan. 9] a group of purported warrant-holders including Corlett issued a formal demand for those to be turned into shares, which Corlett said in a statement would hand them control of the company.

The warrants aren’t valid and Yodel has no legal records of them, a spokesman for the company said in a statement.

Failed Takeover

Shift drew comparisons with Uber due to its model based on allowing users to book a van using the platform. It expanded via acquisitions, and later began to focus on logistics carriers, putting struggling Yodel in its sights. It secured backing from investors including venture capital firm Fuel Ventures.

Yodel, which employs as many as 12,000 people in peak periods and says it delivers over 190 million packages a year, began life as the logistics division of retailer Very Group before expanding. Its website lists clients including the John Lewis department store group and fashion retailer Zara, whose customers can collect online orders at a Yodel shop. Until last year, it was owned by the Barclay family, who recently lost control of the Telegraph newspaper group.

It recorded a loss of £48.3 million in 2023, accounts show. Yodel was near collapse when a Shift-led consortium backed by boutique investment bank Solano Partners bought it for a nominal £1 in February last year.

Just a few months later, Corlett’s short-lived ownership of Yodel ended. The company’s struggles have continued, with a capacity crisis over Christmas forcing it to tell some retail customers it couldn’t deliver their products. A spokesman said it’s no longer experiencing problems.

“A new direction is clearly required at Yodel,” Corlett said.

Legal Fight

Yodel alleged in filings that Corlett directed or caused payments to be made for his own benefit, including £1.5 million paid to a Shift subsidiary “for no proper and legitimate purpose and for no consideration.” It also said £2.67 million was paid to Shift as commission for facilitating a license fee arrangement to use its platform on uncompetitive terms. Yodel is claiming for at least £4.6 million.

For his part, Corlett denies any involvement or knowledge of the £1.5 million payment. He also denies being involved in negotiating the license deal to use Shift’s platform — though he does acknowledge signing it when presented with a draft agreement. He says he had no knowledge of the £2.67 million invoice.

But rather than the license terms being bad for Yodel at an annual fee of £18 million, he says the company stood to make savings of about £78 million.

In the court filings, Corlett also alleges he was forced out in June by PayPoint Chief Executive Officer Nick Wiles and Yodel’s CEO Mike Hancox as they tried to wrestle control from him. According to Corlett, Wiles pushed him into selling the consortium’s shares to a new firm controlled by Hancox for £1, and threatened to take steps that would put Yodel into bankruptcy if he did not agree.

Wiles declined to comment.

Corlett alleges he never got a promised 10% stake in Hancox’s new firm, or payments under a new consultancy agreement he said were agreed at the time.

Instead of honoring those obligations, Yodel’s CEO “made vindictive, baseless allegations with no supporting evidence in a transparent attempt to pressure me into abandoning my legal rights, which will not succeed,” Corlett said.

“Yodel is aware of a number of groundless claims about our business being made by a former director which we refute in their entirety,” the company said.

Topics Lawsuits