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Mon 4th Jun 2018 - Wagamama seeks new owners for global growth
Wagamama seeks new owners for global growth: Wagamama is seeking new owners to share its taste for global ambitions. The company, chaired by Allan Leighton, has appointed Goldman Sachs to review what is described as “strategic growth options” for the business, reports The Times. While a sale to a trade buyer is not being ruled out, preferred bidders are likely to be among the big American private equity firms with the funds to ignite Wagamama’s fledgling operation in the US. Duke Street and Hutton Collins, the company’s present owners, are understood to have been encouraged to press ahead with the appointment of advisors by the sale last week of Pret A Manger to JAB Holdings, the German food sector investor, for £1.5bn. Analysts said applying a similar multiple of 15 times’ earnings would value Wagamama at more than £750m. While fellow restaurant groups such as Jamie’s Italian, better burger brand Byron, Carluccio’s and Prezzo are using Company Voluntary Arrangements to close loss-making sites, Wagamama has continued to drive sales via both organic growth and new openings. In March, the company reported an 8.2% increase in its UK like-for-like sales in the third quarter, an acceleration on 7.1% second-quarter growth. Its total turnover rose by 12.5% to £72.1m in the three months to 28 January 2018, lifting revenues for the first 40 weeks of its financial year to £229.5m, up 13.5%. The group, which was founded in London in 1992 by Alan Yau, operates 130 outlets in the UK and five in the US and has another 51 franchised restaurants around the world. It is planning another two openings in New York in the next 12 months. Duke Street and Hutton Collins, who paid private equity firm Lion Capital £215m for Wagamama in 2011, are believed to be open to retaining a minority stake alongside a new lead investor.
 
Hotel Chocolat repays £6.4m of debt: Hotel Chocolat Group has announced the repayment of £6.4m of debt borrowed from its customers in the form of “Chocolate Bonds”. The company stated: “In 2010 and 2014, the Chocolate Tasting Club, a subsidiary of the group, issued two bonds that paid a return in the form of luxury boxes of chocolate or Hotel Chocolat gift cards. The bond proceeds were invested in capital projects that supported the growth of the company and developed cocoa sustainability projects in St Lucia and Ghana. At inception, the net cash proceeds received for these bonds were recognised as a liability. Each year the cost value of the chocolates was recognised as an interest expense. The bond proceeds have contributed to the creation of 600 jobs in the UK; new store openings in the UK and Ireland; capital investment in manufacturing in the UK; increased support for cocoa growers in Saint Lucia and Ghana; sustainability projects including the creation of four model farms that supply disease-resistant cocoa seedlings and demonstrate best practice cocoa growing techniques to improve yields and farm incomes; and a fully operational community medical centre in Osuben, Ghana. The bonds were repayable by the company without notice. The company would like to thank the bondholders for the important role they have played in the growth and development of Hotel Chocolat. The ongoing growth of the business has now increased operating cash generation to the extent that the board believes the continuation of the above growth and sustainability projects can now be funded using the group’s available working capital.” Co-founder and Chief executive Angus Thirlwell said: “Thanks to the support of our amazing Chocolate bond-holders, we were able to invest in ethical cocoa, British manufacturing, create hundreds of jobs and then repay them in full, as planned.”

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