LONDON: Wyevale Garden Centres Plc. is being acquired by WCC Hortis, a takeover company promoted by millionaire retail entrepreneur Tom Hunter’s TBH Trading and Icelandic investment group Baugur.
The company, which is Britain’s largest plant retailer with some 114 horticulture stores, said it has agreed to a cash offer of 310.9 million pounds and is recommending it to shareholders. The offer is at 555 pence-a-share of the company, which is at a 11 per cent premium on the company’s closing price on 16 January, the day before the bid was made.
Including debt, the deal is worth 445.1 million pounds.
Hereford-based Wyevale said Bank of Scotland is providing debt facilities for the acquisition. The loans will be used to refinance the company’s current debts, to provide working capital after the acquisition is completed, to pay fees and expenses and to pay a lump sum to its pension fund.
WCC Hortis already owns 28.7 per cent of Wyevale after it had acquired a 14.99 per cent holding from private equity group Laxey Partners at 555 pence-a-share in February. Wyevale had said at that time there could be full takeover. Laxey Partners had in December managed to oust the chairman and two directors of Wyevale in a boardroom power struggle.
Wyevale had earlier been eyed by private equity firm Cinven, which had made an offer of 325 million pounds.
Once the takeover is completed, TBH Trading will own 40.1 per cent of the company and Baugur’s BG Holding 26 per cent. Besides, HBOS Plc. unit Uberior Investments Plc. will have 19.9 per cent, Prestbury Investment Holdings, an investment company set up by Nick Leslau and Nigel Wray, 12 per cent and LxB SmallCo, a company owned by Hunter, Baugur, Uberior and company managers, the balance 2 per cent.
Wyevale had reported a net income of 505,000 pounds for the year ended 1 January, down from 11.2 million pounds a year earlier. Revenue for the period had fallen 2.5 per cent to 187.6 million pounds.
The company’s chairman, Jim Hodkinson, who joined the firm in December after his predecessor, David Williams, was removed, had said the decline in profit had been on account of declining sales and a one-time cost of 18.2 million pounds, including a 4.7-million-pound inventory write-off, 4.3 million pounds of costs related to Laxey’s efforts to remove Williams and other directors, and 9.2 million pounds resulting from a revaluation of property.
Shares of Wyevale fell 3 pence, or 0.5 per cent, to 549.5 pence Friday. They had gained 14 per cent after the bid was announced and Hunter’s name was linked to it.