West Midlands corporate deals review in association with Clearwater International

AS THE world’s attention was focused on the US election, and the shock that came with it, business continued in the Midlands and as we head into the final quarter of the year, deal levels seem to be holding. The Business Desk recorded a total of 28 deals in the Midlands in October, a slight increase on September’s 27. 
Expanding his restaurant empire, Birmingham based food tycoon Ranjit Boparan – who in September gobbled up turkey giant Bernard Matthews – announced the purchase of US style restaurant group, Ed’s Easy Diner, through subsidiary company Giraffe. For a rumoured price of £8.75m, the deal included 33 of the chain’s 59 restaurants, with the remaining 26 set to close. 
It’s no secret that the Ed’s brand has struggled over the past 12 months. A decline in trading combined with over-expansion led to cash flow problems for the group, which subsequently ended their sale process that began in 2015. After failing to attract high enough bids during its process the business was transacted as a “pre-pack administration” to Giraffe by KPMG.
The 2 Sisters Food Group owner purchased casual restaurant chain Giraffe just 5 months ago, from retailer Tesco. This was preceded by the purchase of Indian contemporary restaurant group, The Cinnamon Collection in January, speculating Boparan’s intention of building a casual dining empire.
As the UK increasingly looks to eat out instead of cooking at home, branded casual dining chains are expanding, and with the casual dining experience remaining an important part of a shopping trip for many consumers, businesses in the space are continuing to see an enormous amount of interest, both from trade and private equity alike. Recent deals in the space have included:
BC Partners’ acquisition of French food chain Côte;
Casual Dining Group’s purchase of Latin American chain Las Iguanas;
Famous Brands’ acquisition of burger chain Gourmet Burger Kitchen; and
Equistone’s purchase of Argentinian chain Gaucho Grill. 
With a continually increasing amount of customers filing through the doors of restaurants, resulting in numerous chains opening more and more branches, it would seem that the market could benefit from using food procurement providers, in a similar way that most hotel chains do. 
Food procurement remains an attractive space due to its ability to provide cost saving solutions to its clients. This was demonstrated just last month with the purchase of Warwickshire based food procurement company PSL by French food and facilities management services giant Sodexo, in a deal advised on by Clearwater International. 
Established in 1993, PSL has become a leader in fresh food procurement in the UK with its integrated approach of procurement, operations and systems support. The company operates within a wide spectrum of the hospitality market including restaurants, hotels, hospitals and contractors amongst others, working with the likes of The Dorchester, Marriott and Drake & Morgan. 
With outsourcing traditionally associated with external support in non-core business activities, more recently, we’re seeing companies look to outsource a greater number of business critical functions and beginning to see how this can create significant commercial advantages as a result.

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