The owners of PizzaExpress have finally won the battle for pizza and pasta chain Ask Central with a £213m bid that dashed the hopes of former suitors the Restaurant Group.
Capricorn Ventures and private equity group TDR Capital confirmed their offer of 220p a share minutes before the final deadline last week. They received the backing of Ask Central's management, including founders the Kaye brothers.
The offer represents a price of about £1.3m per Ask restaurant and a 20.7% premium over the Restaurant Group's bid of 182.3p a share. Chairman of the Restaurant Group (formerly City Centre Restaurants) Alan Jackson said: "Our offer for Ask Central had both commercial and financial logic, at what we considered to be a fair price. However, we were not prepared to overpay."
Adam and Sam Kaye have been retained by TDR and Capricorn and will continue in their current roles on basic salaries of £150,000 and £120,000 respectively.
Commenting on the offer, Manjit Dale, founding partner at TDR Capital, said: "Adam and Samuel Kaye and their team have built a great business with excellent prospects. We intend to build on their success by developing the leading full-service restaurant chain in the UK."
Analyst Nigel Popham at stockbrokers Tether & Greenwood warned that, despite TDR's success in buying its primary rival, the future of the high-street restaurant market remains uncertain. "There is now a huge amount of competition for diners on the high street, and the next two years are going to be difficult for restaurants in this area. The pizza market has also reached saturation point," he said.
PizzaExpress was founded in 1965 and now operates 305 restaurants. The company was floated on the London Stock Exchange in February 1993 and acquired by TDR Capital for about £277.8m in July 2003.
Ask Central opened its first restaurant in 1993 and now operates a total of 172 restaurants, principally under the Ask and Zizzi brands.