Osmond bids to buy back PizzaExpress
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The former owner of PizzaExpress, Hugh Osmond, yesterday launched a bid to buy back the company he floated nine years ago in a deal that values the restaurant chain at about £244m today.
The indicative offer, made through Mr Osmond's venture capital outfit, Sun Capital Partners, and by Capricorn Ventures International, of 330p to 350p a share is a premium of 3 to 9 per cent on its Friday close of 320p.
Mr Osmond, alongside the restaurant entrepreneur Luke Johnson and David Page, the current chief executive of PizzaExpress, took the group public in 1993. It floated at a price of 40p.
Its shares closed up 31p, or nearly 10 per cent, at 351p yesterday, above Mr Osmond's indicative offer. Analysts said Mr Osmond would have to offer at least 400p a share to win over shareholders. Mr Osmond, however, has indicated although the approach is in its early stages, he is not prepared to pay a huge premium for the group.
"If anyone thinks I am going to pay an enormous premium for the company, they have been sprinkling something stronger than pepper on their pizza," Mr Osmond said.
Mr Osmond's heavyweight credentials are thought likely to sway some investors. "He does know about restaurants and he doesn't believe PizzaExpress is broken. The offer does make sense. The only thing that doesn't is the price," one analyst said.
Shares in PizzaExpress have fallen more than 60 per cent this year as it felt the strain of falling sales from failing to keep pace with rival chains and recently hit a year low of 245p. Earlier this month, it posted a 4.4 per cent fall in like-for-like sales from its restaurants in the UK for the 12 weeks ending on 22 September. The languishing share price has made PizzaExpress a takeover target for some time and a number of bidders, such as Whitbread and Six Continents, are thought to have been in the frame.
The approach may flush out rival bidders, including Mr Osmond's former university friend and business partner Mr Johnson, who is in the process of acquiring Signature Restaurants for £25m.
The negative trading statements from PizzaExpress over the last quarter indicating like-for-like sales declines, and the company's recent share price low sparked the interest from Mr Osmond.
Mr Osmond left PizzaExpress in 2000 to take the helm at Punch Taverns, which he floated this year. He founded Sun Capital in July 2001. Capricorn is a privately owned investment group and the largest investor in Nando's International, a budget restaurant chain.
PizzaExpress yesterday made no further statement after the identity of the bidder was revealed. The board is considering the offer and said it will make a further announcement in due course.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments