After the recent announcements on restaurant floats and takeovers, it’s now the turn of hotels, catering and pubs, including the sale reported today of Amber Taverns.
Mitchells & Butlers/Orchid Pub Company
M&B is apparently nearing the acquisition of Orchid, having outbid competitors and entered exclusive talks to buy 180 of Orchid’s 220 pubs at a price suggested to be in the region of £266 million. The 40 remaining pubs would enter administration.
M&B would welcome Orchid’s food-led estate, with Pizza Kitchen and Great British carvery joining their All Bar One and Harvester brand offerings.
Numis takes a very favourable view of the acquisition, commenting:
“The likely acquisition of Orchid Pub Company should be an excellent transaction for M&B, in our opinion. It could be the last non-hostile takeover of a food-led estate in the sector for the foreseeable future. Offering material synergies, a minimal cost of financing and attractive returns from brand conversions, the deal should be strongly earnings enhancing in our view. We are upgrading our recommendation to Buy (from Add).”
Elior to raise £687 million
Elior is Europe’s third largest catering organisation and is aiming to raise at least £687 million in an IPO, using this money to cut debt and fund further expansion.
It expects to make its debut on the Paris bourse on 11 June, with the shares priced between 14.35 and 17.50 ecus.
Elior is 62.4% owned by Charterhouse Capital Partners, and the listing is expected to value Elior at between 2.4 and 2.8 billion ecus.
IHG
As previously reported, IHG may be a giant in the international hotel industry, but that doesn’t make it immune from possible takeover. Shares in IHG jumped this week on rumours that a £6 billion bid had been made – and rejected because it was considered too low.
The rumour suggests that the approach has been made by a US hotels or investment group, with Starwood the favoured candidate.
Now, activist investor Morcato Capital Management – holding 3.8% of shares – is reported to have urged IHG to consider the merits of a merger that could have ‘compelling strategic and financial merit’.
We await next moves…