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Swiss Travel Retailer Dufry To Buy Italy's Autogrill

By Dave Simpson

Duty-free retailer Dufry DUFN.S has agreed to buy Italian airport and motorway caterer Autogrill AGL.MI, creating a travel industry giant to take advantage of growth opportunities as the sector rebounds, the companies said on Monday 11 July.

Details

Italy's Benetton family - Autogrill's largest investor - will transfer its entire 50.3% stake to Dufry, which will offer to buy out minority stakeholders, with the Benetton's holding company Edizione then becoming the combined group's biggest shareholder with a stake of 20-25%.

"The combination of the two groups will create a new leader in travel experience and allow us to significantly increase our presence in core markets, such as the US, and in the travel food and beverage sector," Dufry chairman Juan Carlos Torres said in the companies' statement.

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"This transaction will strengthen our balance sheet, reduce our leverage and create meaningful synergies."

At Friday 8 July's market prices, the two companies had a total market capitalisation of approximately $5.5 billion.

Dufry CEO Xavier Rossinyol will lead the combined group, Torres keeping his role in the new company.

The transfer of the Benetton family's stake, held through Edizione, will be at a ratio of 0.158 new Dufry shares for each Autogrill share, the groups said in a statement.

The offer represents a discount of 25-30% to trading prices on Friday 8 July, Rossinyol said on a call with reporters.

Dufry's subsequent tender for remaining Autogrill shares will offer 0.158 new Dufry shares for each Autogrill share or €6.33 per Autogrill share.

Dufry shares rose 6.2% in early trade on Monday 11 July while Autogrill stock fell 8%.

"We welcome the deal announcement as the business combination of both companies represents a complementary strategic fit and will support Dufry’s new long-term strategy," Baader Helvea analyst Volker Bosse wrote in a client note.

The combined entity will be given a new name and the deal is expected to complete in the second quarter of next year.

Dufry said the combined company will cater to 2.3 billion passengers in more than 75 countries, generating revenue of 13.6 billion Swiss francs ($13.90 billion) and core earnings of 1.4 billion Swiss francs.

Autogrill's current CEO, Gianmario Tondato da Ruos, will take on the position of executive chairman of the new group's North American business and Edizione Chairman Alessandro Benetton will join as honorary chairman.

The companies had confirmed they were in non-exclusive talks in late June.

Basel-based Dufry operates approximately 2,200 shops at airports, cruise liners, seaports and other tourist locations worldwide.

Dufry's organic sales more than doubled in the first quarter of 2022, driven by a strong rebound in European travel as coronavirus curbs eased. However, organic sales were still 40% below pre-pandemic levels in 2019.

For the second quarter net sales were down approximately 17% compared with 2019 and first-half sales were down approximately 25% from 2019, Dufry said.

Autogrill runs bars, cafes and restaurants at 139 airports internationally, including 80 in North America, as well as on motorways in Europe.

Financial Advisers

UBS and Credit Suisse acted as financial advisers to Dufry, with BofA Securities acting for Edizione.

Citigroup Global Markets Europe AG, Intesa Sanpaolo and Mediobanca were financial advisers for Autogrill.

News by Reuters, edited by Hospitality Ireland. Click subscribe to sign up for the Hospitality Ireland print edition.

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