Capricorn, TDR enjoy pizza success

ABN Amro’s lapsed offer for UK pizza chain PizzaExpress has handed victory to TDR Capital and Capricorn’s 387 pence per share offer for the business.

GondolaExpress, the acquisition vehicle set up by South African private equity firm Capricorn Ventures International and London-based TDR Capital, has succeeded in its attempt to acquire UK restaurant group PizzaExpress after ABN Amro Capital and Luke Johnson, bidding via Venice Bidder, decided against improving their 367 pence per share offer.

 

In a statement to the London Stock Exchange, Venice Bidder said it was no longer interested in PizzaExpress after it revealed a third consecutive quarter of disappointing like-for-like sales performance. In Q2, like-for-like sales in its core PizzaExpress operation were down by 5.1 per cent in the second quarter. In Q3, sales were down by 9.4 per cent. “Against this trading background, and after careful consideration, the board of Venice Bidder has decided against increasing its 367 pence offer, which has now lapsed.”

 

Prior to the announcement, GondolaExpress said it had control or had valid acceptances for 17.1 per cent of PizzExpress shares. Venice Bidder, which holds 8.5 per cent of PizzaExpress shares, said it would accept the Gondola offer.

 

Alongside consumer-oriented private equity investor Capricorn Ventures, TDR Capital has secured financing for the deal, which will be provided by HBOS Bank.

 

Manjit Dale, formerly a senior figure in Deutsche Bank’s London-based captive buyout operation, DB Capital Partners, is currently raising a debut E500m mid-market buyout fund for TDR Capital. Tudor Investment Corporation, the Boston-based hedge fund manager, has already agreed to make a E160m cornerstone investment in the fund.

 

Capricorn Ventures invests across a range of consumer related sectors, including financial services, restaurants, food and beverages. It controls a majority stake in Nandos International, which operates 380 chicken restaurants worldwide.

 

PizzaExpress is being advised by Credit Suisse First Boston. TDR Capital and Capricorn are being advised by ING Barings. The ABN Amro consortium was advised by Hawkpoint.