Competition for Thorntons hots up

Private equity firms lining up to buy UK chocolate retailer Thorntons now face greater competition following the appearance of more suitors prepared to examine possible bids.

More bidders have thrown down the gauntlet to a clutch of private equity firms already interested in buying Thorntons, the high street chocolate retailer.
Thorntons chairman John Thornton told the group’s annual shareholder meeting: “I can report that a number of additional preliminary approaches have been received from interested parties independent of the management team.”

Thorntons revealed it had received a ‘tentative’ offer from a private equity house two weeks ago, but had rejected it on the basis that it was too low. Apax Partners, Permira and Texas Pacific Group are among those to have been linked with a possible approach for the business.

Following the initial approach, Thorntons agreed to talks with potential bidders and hired Rothschild to advise it on the process. It is still believed to be holding talks with at least one private equity firm.

Thorntons, which has 600 retail outlets, endured a difficult summer when the exceptionally hot weather deterred consumers from buying chocolate. The firm reported like-for-like sales in franchise stores down 7.2 per cent and in its own stores down 1.9 per cent.

The firm, which was founded in 1911, makes own-brand chocolates and branded products for other retailers including Marks & Spencer. The Thornton family owns a total 28 per cent stake, with chairman John Thornton owning 5.5 per cent.