Luke Johnson launches new attempt to sell bakery chain Gail’s –

Luke Johnson launches new attempt to sell bakery chain Gail’s – fr

Luke Johnson, the hospitality entrepreneur and former president of Patisserie Valerie, has relaunched his attempt to sell upscale bakery chain Gail’s after a strong performance during the pandemic.

Johnson told the Financial Times his private equity firm Risk Capital Partners, which owns Gail’s, asked Bank Nomura to restart a process of selling the chain after it was canceled when the first foreclosure was announced last year. .

He said that while the pandemic has been a ‘roller coaster’ for Gail’s, which has hosted long queues for its pastries during lockdowns, the brand has performed “well, certainly over the past nine months.” The board is targeting earnings before interest, taxes, depreciation and amortization of £ 20million by February 2022.

From the year to the end of February 2020, before the pandemic, Gail made pre-tax profits of £ 2.8million on sales of £ 61million. It operates 68 sites in the UK, mainly in London.

2,8 M £

Profits before taxes realized during the year at the end of February 2020

Despite the good performance, although other cafe operators struggled, Johnson said a suggested value for the company of £ 250million was ‘bullish’, although he noted that he There was a large number of potential investments, especially for companies that should benefit from the ease of lockdowns. .

Johnson, who first invested in Gail’s in 2011 for an undisclosed sum, said he plans to retain his own 20% stake in the company, but that Risk Capital Partners will leave the company. He previously owned and ran PizzaExpress and The Ivy, and founded the casual restaurant chain Strada.

Take-out food operators have been allowed to remain open in the UK for take-out sales throughout the pandemic, although many closed during the first lockdown due to concerns for staff safety and a lack of sales.

Some companies have rebounded better than expected. Greggs, the bakery and coffee shop chain, said in an update this month that it expected to reach nearly double the analyst consensus for its profits this year and be close to its 2019 profit of 144. million pounds sterling.

Gail’s opened its first bakery in Hampstead in 2005 and has expanded to sell its famous sourdough bread to supermarkets such as Waitrose and wholesale to food service companies.

The Valerie pastry shop, which Johnson launched in 2014, collapsed in 2019 due to an accounting scandal. The company’s auditor, Grant Thornton, is being sued for £ 225million by his liquidator FRP Advisory for negligence.

During the pandemic, Johnson bought gardening e-commerce specialist Primrose and struck a deal last month to buy Curious Brewing, a craft brewer owned by English winemaker Chapel Down, for around £ 5million. “It’s a good time to buy things,” he said.

Nomura’s appointment was first reported by Sky News.


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