JAB Holdings buys Pret a Manger in GBP1.5bn deal

Private equity firm Bridgepoint has agreed to sell sandwich shop chain Pret a Manger to JAB Holdings in a deal worth some GBP1.5bn.

Bridgepoint originally paid just GBP364m for the chain, which has rapidly expanded in recent years adding 50 new outlets in the past 12 months alone.

The GBP1.5bn deal to sell the popular chain to JAB Holdings is an alternative plan to Bridgepoint’s initial strategy of floating Pret a Manger on the New York Stock Exchange to try to help break further into the US market. However, it decided that a better price could be obtained through a direct sale.

There are currently some 500 Pret stores in the UK and there are also outlets in the US, Dubai and China.

The plan to sell the chain has resulted in a valuation of around 15 times earnings before interest, tax, depreciation and amortisation. The deal is just the latest in a string of similar purchases for JAB Holdings, which is a Luxembourg-based investment vehicle owned by Germany’s Reimann family. It already owns the Kenco, Douwe Egberts and Tassimo brands and the Krispy Kreme chain on doughnut and coffee shops.

JAB’s Olivier Goudet, it’s Chief Executive, said that the management at Pret a Manger has a proven track record and that, as its new owner, JAB intends to invest in new products to reflect changing consumer tastes. He stated: “We’re very excited to partner with Pret and its talented team to continue their extraordinary growth story.”

In 2016, Pret a Manger recorded record sales of GBP776m, up 15 per cent from 2015. As a result of this sales increased EBITDA increased by 11 per cent to GBP93.2m.

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