Applegreen Agrees €360 Million Acquisition Of Major UK Service Area Provider
Applegreen has announced that it has entered into contracts to acquire a majority holding in Welcome Break, one of the leading motorway service area operators in the UK.
Applegreen said that it has entered into an agreement with NIBC European Infrastructure Fund to acquire its 55.02% holding in Welcome Break, worth €361.8 million.
It has also entered into a separate agreement with Welcome Break Investors II LP, a limited partnership that holds the remaining 45% of the company.
Applegreen’s directors said that they believe these agreements will give it a ‘greater operational influence over Welcome Break’.
The Best Facilities
"Welcome Break is a fantastic business, it has led the way in providing the very best food and beverage facilities on the UK motorways,” said Bob Etchingham, CEO of Applegreen.
“We were attracted to Welcome Break because of the strength of its franchise, the excellent management team and the committed staff at each of its 35 locations. We look forward to continuing to grow the Welcome Break business and to offering the c. 85 million customers who visit Welcome Break each year the very best experience on UK motorways."
Announcing the deal in a statement, Applegreen called Welcome Break a ‘well-regarded brand’ that has a long and successful track record and a high-quality portfolio of food and retail offerings.
The UK group has over 55 years' experience in the sector and 5,000 plus employees operating food and retail brands such as Starbucks, KFC, Burger King, Subway, Waitrose, Harry Ramsden's and WH Smith.
It generates ‘robust and consistent cash flows with high traffic volumes and strong margins particularly in its food business,’ the statement said.
A Good Pair
Darren Kyte, Managing Director of NIBC Infrastructure Partners and Chairman of Welcome Break Group welcomed the move, calling it a “transformational transaction in the UK MSA sector”.
“I am sure that the combination of the Applegreen Service Area operations in the UK with those of Welcome Break, and combined management capabilities will help build further upon the consistent and strong earnings growth seen by both businesses over the past decade,” Kyte said.
The transaction, Applegreen said, constitutes a reverse takeover of the Company under the ESM and AIM rules, and thus requires shareholder approval and the publication of an AIM and ESM Admission Document with details of the Enlarged Group.
Until the Admission Document has been published, trading in Applegreen’s shares will be suspended on both the AIM Market of the London Stock Exchange and the ESM Market of Euronext Dublin with immediate effect.
© 2018 Checkout – your source for the latest Irish retail news. Article by Aidan O’Sullivan. Click subscribe to sign up for the Checkout print edition.