The restaurant industry is being swept by listing fever, it seems. After Gondola Holdings, the owner of the Pizza Express and Ask brands, listed on the London Stock Exchange earlier this month, Carluccio’s has announced it too is coming to market.
The Italian eateries and food retail business that comprises Carluccio’s is to float on the Alternative Investment Market, the junior subsidiary of the main
London Stock Exchange. It is expected to be valued at more than £50m.
A key attraction for investors is the opportunity to take part in the company’s rapid growth to take the existing 21 stores into triple figures. Last year
profits were up 46% to £3.5m and sales were up 32% to £36.8m.
The news of its listing plans was accompanied by the unveiling of two more stores, in Reading and in Westbourne Grove, West London, taking the total to 23.
Its growth so far has been financed through existing cash flow and this is set to continue. No new money is being raised in the float, instead the existing investors are being allowed to exit after being in for around six years.
Among the investors cashing in are Antonio and Priscilla Carluccio, the husband-and-wife team that helped set up the chain and gave it its name. They should net around £10m by reducing their stake from 20% to 3%.
Growth is expected to continue to be steady. Managing director Simon Kossoff said five or six new outlets a year is the likely number.
Despite Carluccio’s unique business model – which means trading begins in the early morning, a time when most restaurants are closed – the valuation multiple looks a fairly racy 18 times next year’s earnings were the company to float at the top end of its suggested range that values it at almost £56m.
Carluccio’s is undoubtedly a strong business but are investors desperate enough to get onto the casual dining trend to buy-in at such a high price?
The IPO bandwagon also started rolling this week for Britvic, the soft drinks business owned 23.8% by Whitbread and 47.5% by InterContinental Hotels. The company is expected to be worth about £800m on listing, raising a healthy sum for the two hospitality giants.
Set to join the board of the company as non-executive directors are Bob Ivell of Regent Inns and Michael Shallow of Greene King.
Britvic was originally known as the British Vitamin Products Company. The current outfit was established in 1986 when the soft drinks businesses of
Whitbread, Bass (now InterContinental) and Allied Breweries (now Pernod Ricard) were merged.
A stockmarket listing that is not happening, however, is that of Loch Fyne Restaurants. Last week shareholders approved a £30m bid from venture capitalists Hutton Collins.
Via its vehicle Premium Casual Dining, Hutton Collins paid £21.8m in cash plus debt for the 25 Loch Fyne restaurants and five Petit Blancs.