Forecourt retailer Applegreen is in “advanced discussions” to sell the business to a consortium that includes its founders, Robert Etchingham and Joseph Barrett.
B&J Holdings, a 41.3pc shareholder in Applegreen representing the holdings of Mr Etchingham and Mr Barrett, along with Blackstone, a multi-billion dollar private equity and investment group, has made an offer of €5.75 per share for the company.
Should the transaction proceed, B&J Holdings would retain a “significant” equity stake in the consortium, and Mr Etchingham and Mr Barrett would maintain their current management positions as CEO and COO respectively, according to a statement from Applegreen.
The cash offer represents a premium of 48.2pc to Applegreen's closing price of €3.88 yesterday, and a premium of 63.7pc to its volume weighted average share price of approximately €3.51 over the three-month period ending December 9.
Following receipt of an initial proposal from the consortium, an independent board was formed to review and evaluate the offer.
The board is comprised of all of the directors of Applegreen excluding Mr Etchingham, Mr Barrett and Niall Dolan.
Having considered the offer carefully, the board said that, should the consortium announce a firm intention to make an offer, it intends to recommend unanimously that Applegreen shareholders accept the possible deal.
“The independent board believes the possible cash offer, if effected, would represent a compelling opportunity for shareholders in Applegreen to realise their investment at an attractive premium to the prevailing share price,” the statement said.
Goodbody Corporate Finance are advisers to the buyers in the transaction.
In September Applegreen said it has experienced a “strong recovery” in sales volumes following initial government lockdowns in Ireland and the UK, as reported a fall in earnings of over 50pc for the first half of the year.
The positive momentum has carried into its third quarter, according to interim results from the forecourt retailer.
Applegreen’s group adjusted earnings before interest, tax, deprecation, and amortisation (EBITDA) were €25.3m for the first half of the year, down from €58.9m in the same period last year.
Group revenue of €1.1bn, which is down from €1.5bn in the corresponding period in 2019, reflected a sales reduction of 26.6pc from the impact of Covid-19 lockdown restrictions.
The company, which has operations in Ireland, the UK, and the United States, had net debt of €550.7m at June 30.