Clapham House Group shares rose 11p, or 5.8%, this morning to 202.5p after it was revealed on Friday that Capricorn Ventures International had taken an 11.25% stake in the restaurant group which owns the Gourmet Burger Kitchen and Tootsies brands.
Capricorn amassed the holding after Clapham House last Monday, December 3, unveiled a profit warning which sent its shares tumbling 40%. Analysts are speculating that Capricorn, which owns the Nando’s chain, may be preparing a takeover bid for Clapham House.
Capricorn previously took the PizzaExpress chain private in 2003. At the time, David Page and Paul Campbell, who are now chairman and chief executive respectively of Clapham House, were heading up the pizza business.
Thomson Financial News understands Clapham House has not had any discussions with Capricorn regarding the private equity company’s intentions, and has been in talks with its own shareholders since unveiling its first half results last Wednesday.
Clapham House, however, refused to comment on Capricorn’s stake-building.
In a note to investors, Numis said it is not unreasonable to expect that a takeover battle may loom, with Gourmet Burger the star prize. The broker said 250p to 280p a share as a “realistic take-out price range”, That would value the business at up to £101m (US$205m).
“Alternatively, Capricorn Ventures may put pressure on Clapham House to de-merge Gourmet Burger,” it said.
Dresdner Kleinwort added Capricorn could look to re-branding some of Clapham House’s struggling restaurants as Nando’s.
Numis added that private equity interest is being rekindled in the restaurant sector, given the recent plunge in share prices. It added this is not surprising, given the long-term attractiveness of the sector.