Avoca was sold for €9m less than rumoured €60m price tag
US CATERING giant Aramark paid $57.9m (€51m) for Irish retailer Avoca - much less than the more than €60m that was speculated at the time of the sale last year.
Aramark revealed the purchase price in its quarterly financial report issued this week, and confirmed that it paid for Avoca in cash.
Avoca has 11 outlets in Ireland and employs close to 900 people. It will open its 12th store this autumn.
The business was owned by the Pratt family, but had been put up for sale as long as a year before the acquisition.
Managing director Simon Pratt said in a 2014 interview that he didn't envisage the business being passed on to the next generation, as the ownership and operating structure could become too complicated and fraught.
"It would be almost inevitable that there would be conflict, and the idea that my kids could end up not speaking to my sister's kids is just appalling," he said.
Avoca started off life in 1974 as a textiles business after Simon Pratt's father, Donald, acquired Avoca Handweavers in Wicklow as it faced being closed. He and his wife Hilary then started selling Avoca fabrics from the back of their car. They later opened a purpose-built showroom in Kilmacanogue.
The business flourished. In the 12 months to the end of January 2015, it generated €58.8m in revenue, and a pre-tax profit of €2.6m.
Avoca eventually entered into exclusive negotiations with Aramark last year, and the US company acquired the business in November.
Aramark plans to "internationalise" the Avoca brand, helping it to penetrate new markets, including the United States.
Simon Pratt has remained as managing director with Avoca, and also joined the board of Aramark's Irish arm.
"Aramark provides us with the corporate structures, the global reach and the resources to reach our fullest potential and to continue to grow both in Ireland and internationally," he said at the time of the sale.
Aramark said that Avoca's retail operation would provide the group with consumer insights that would enable it to identify future trends.
The US company said in its second-quarter results this week that it has given the Avoca trade name a "preliminary value" of approximately $14.5m (€12.8m).
Earlier this year, Donald and Hilary Pratt resigned as directors of Avoca, as did their children Vanessa, Amanda and Ivan.
Meanwhile, Ivan Pratt has bought back Avoca's wholesale fashion and homeware business. He was head of sales at Avoca before it was sold, and established a new company called Mill Mount Weavers to buy out Avoca Handweavers Designs.
Aramark said this week that it generated second-quarter revenue of $3.6bn (€3.1bn), and a 6pc rise in adjusted operating income to $221m (€195m) in the period.
Philadelphia-based Aramark is one of Ireland's largest US multinational employers. As well as in food it is also active in areas such as facilities management. It employs 270,000 people worldwide.