After two months on the market, British foodservice supplier Brake Bros has today [Tuesday] found a buyer in the shape of private equity firm Clayton, Dubilier & Rice (CD&R).
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The board of CD&R, through its CDRP Acquisition PLC subsidiary, offered a cash deal of a £8.25 (US$12.39) per Brake Bros share. This represents a premium of 39% to the closing middle market price of £5.925 per Brake Bros share on 8 March 2002, when the firm said it would consider a sale as there is no obvious successor following the imminent retirement of 68-year-old chairman Frank Brake.
The deal, which has been agreed by both parties, values the entire issued share capital of Brake Bros at around £434m. There will be a guaranteed loan note alternative to the offer and Brake Bros shareholders will retain the right to receive the final dividend of 11.83p (gross) per Brake Bros share for the year ended 31 December 2001 payable on 28 June 2002.
Roberto Quarta, of CD&R, told Reuters that his firm would be concentrating on consolidating Brake Bros’ acquisitions over the last two years. It will then seek to expand the business in terms of its geographical cover in Europe and product range, before selling it at a premium.
Meanwhile CD&R’s head, David Novak, told Dow Jones Newswires that Brake Bros will become a “pan-European leader” under CD&R leadership. He added that the food industry is “one we know well. We think it is a sector that has good growth opportunities.”
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