Change Capital takes a majority slice of Vesevo

The UK mid-market firm has struck a deal with Milan-based rival Quadrivio to buy Vesevo, the owner of restaurant chain Rossopomodoro.

London-based Change Capital Partners has taken a majority stake in Vesevo—in a deal valuing the casual dining chain owner at €53.5 million.

Under the agreement Quadrivio, a rival European mid-market shop, will sell its 47 percent stake in the company, and subsequently reinvest for a seven percent stake, according to a statement.

Further financial details of the transaction were not disclosed, but retail and consumer-focused Change Capital aims to invest between €20 million and €50 million of equity in each of its transactions, according to the firm’s website.

Neapolitan dishes: a tasty
investment for private equity

Vesevo, which owns the Rossopomodoro brand alongside other dining formats, serves Neapolitan dishes in 113 locations across Italy. The company also has eight establishments overseas, including three in the UK and two in the US.

The company, which has doubled its network sales over the last four years, is expected to generate a turnover of €100 million and an EBITDA of €6.3 million for its 2010 fiscal year.

Following its new capital injection the company intends to expand Rossopomodoro’s market presence both throughout Italy and abroad. The plan aims to triple the brand’s number of restaurants and take-away stores in five years time.

“Italy’s restaurant market is still fragmented and largely operated by independent owners, giving substantial further room for growth for Rossopomodoro’s winning proposition,” said Roger Holmes, a managing director at Change Capital, in an interview with PEI.

Financing will be provided from Change Capital’s second fund, CCPII, which closed in 2009 with approximately £200 million in capital, according to a source with knowledge of the fundraising.

Fineurop Soditic acted as Change’s financial advisor for the transaction while Italy-based law firm Larbuna Mazziotti Segni served as legal advisor.

For more coverage on Italy’s mid-market, see February’s edition of Private Equity International.