UK transport provider Stobart Group has announced the immediate resignation of its chairman Rodney Baker-Bates and the sale of its Stobart Vehicle Services division to UK-based fleet management and logistics provider Paragon Group. The division has been renamed Paragon Vehicle Services.

Stobart Vehicle Services was formerly part of the Autologic business Stobart bought in September last year for £12.4m ($19.6m, read more here). Avril Palmer-Baunack, the former head of Autologic who moved to Stobart following the buyout, has now replaced Baker-Bates as chairman. He will remain on the board for one more month as a non-executive director.

Baker-Bates’ resignation was supported by some of Stobart’s largest shareholders according to the Financial Times.

In a statement, Stobart Group’s CEO, Andrew Tinkler, said that Baker-Bates had been “an outstanding chairman through a period of significant change and development for the group [and] served with great steadiness and distinction”.

The sale of the services division means Stobart is divesting itself of management services including car preparation, customisation and port operations, but will retain the vehicle transport part of the business, including the truck fleet.

The company said that the sale would allow Stobart Automotive to “consolidate its position as the number one provider of vehicle transport in the UK and focus on growth within the transport division, which includes Sensible Transport [originally bought by Autologic] and Enable Logistics”.

Commenting on the decision, Paragon Group would only say that it chose to purchase Stobart Vehicle Services because it was “an excellent fit” with the company’s plan to expand into complementary services “by taking it into new areas of vehicle processing whilst expanding its existing customer base”. 

The new business represents an annual turnover of approximately £40m and will provide services for Toyota, Vauxhall, Nissan and Vauxhall Vans.

Tony Booth, divisional managing director, will continue to lead Stobart Automotive, reporting to Palmer-Baunack.  However, the shakeup will also see the departure of David Beever, a non-executive director, who the company has said will stop down from the board immediately “to devote more time to his other business commitments”.

Paragon, meanwhile, will now operate eight new sites including facilities at Corby, Portbury, Doncaster and at five additional UK locations where its carmaker customers are based: two facilities in Luton for the Luton contracts; one in Burnaston for Toyota; one in Sunderland for Nissan and one at Ellesmere Port. It will employ an additional 500 staff and the division will be run by Stephen Hucklesby, CEO of the Paragon Group, who will oversee its integration over the course of the next year.

“Paragon Vehicle Services is an excellent fit with Paragon and underlines our group strategy to expand into complementary service offerings by taking us into new areas of vehicle processing and giving us a focus on port and new vehicle processing excluding transport,” said Hucklesby. “Coupled with this, we will be expanding our geographical network, giving us an important presence in the North East and South West.”