Meat and deli products retailer Crawshaw is reversing into Felix Group.
Crawshaw operates 14 retail stores and two processing and distribution centres. They are in the Yorkshire, Humberside and Lincolnshire area. Richard Rose is chairman of Crawshaw and executive chairman of Felix.
Felix, which put its internet kiosks business into administration, is paying 31.2m shares for Crawshaw and raising £4m at 37.5p a share. The placing price is based on new shares following a 50-for-one share consolidation. The acquisition values Crawshaw at £11.7m – if the placing price is used. Existing shareholders have agreed to retain £9.7m worth of shares.
Turnover has been relatively flat over the past three years to January 2008, moving from £14.2m to £14.6m. That includes the purchase of Crawshaw Butchers during the most recent year. Profits fell from £2m in the year to January 2007 to £600,000 last year. Installing new systems was part of the reason but there was a fall in the underlying profits.
Existing outlets are mature according to the company but there is scope to roll-out the format to more towns. A specialist adviser has identified 40 potential sites. These are in the existing heartland of the business. The existing processing sites can cope with double the volumes so opening up new sites should help to improve efficiency.
Investec will become nominated adviser and broker.
Felix shares jumped 89% to 0.9p – equivalent to 45p post-consolidation. The bid/offer spread is wide at 0.7p (35p) to 1.1p(55p).
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