The Restaurant Group said on Thursday it had received a request for information from PizzaExpress Group owner Wheel Topco Limited to evaluate a possible offer, weeks after it agreed to be taken private by Apollo Global.
The Wagamama owner, which has been struggling with falling margins amid soaring costs and sluggish recovery post-pandemic, will consider Wheel's proposal, the company said in a statement, adding that there had been no indication of a possible offer.
Pressure From Shareholders
The Restaurant Group on Oct. 12 had agreed to be taken private by private equity firm Apollo Global for £506 million (€579 million).
It also faced pressure from shareholders and activist investors Irenic Capital and Oasis Management in recent months to change management and improve profitability.
Chairman Steps Down
In September, chairman Ken Hanna agreed to step down, after the company forecast higher annual profits.
TRG, which owns popular Japanese noodle chain Wagamama, also agreed to sell its loss-making Frankie & Benny’s and Chiquito brands to Café Rouge owner the Big Table Group, as part of efforts to bolster margins and cut debt.
The company’s board has unanimously recommended that shareholders vote in favour of the deal, which has an enterprise value of £701 million (€811 million) and is expected to be completed in early 2024.
In a statement earlier this month, US private-equity firm Apollo noted that it believes that the development of the company will be best served as a private business, with access to capital and the benefit of a long-term investment approach.
‘We understand that this was an unsolicited approach, so it is possible that it flushes out another bid,’ Stifel analysts wrote in a note, adding that they, however, expect the deal to go through.