Mitie To Sell Catering Business To CH&CO For Up To GBP 85 Mln In Cash
Mitie Group plc (MTO.L), a provider of facilities management and professional services, announced Monday that it has entered into an agreement to sell its catering and hospitality business, Mitie Catering, to CH&CO for a consideration of up to 85 million pounds in cash, on a debt-free, cash-free basis.
The consideration comprises an initial consideration of 73 million pounds payable in cash at completion, and a deferred consideration of up to 12 million pounds.
The sale includes Mitie Catering Services Limited, the catering business assets of Mitie Facilities Management Limited in Ireland, together trading under the name Gather & Gather. The sale also includes Creativevents Limited.
Under the deal, Mitie and CH&CO will enter into a strategic partnership in which the “Gather & Gather” catering offer remains exclusive to Mitie’s clients as its only Integrated Facilities Management or IFM sector partner.
Mitie Catering is a provider of contemporary contract workplace dining, hospitality and event catering service in the UK and Ireland. It employs over 3,600 people at over 330 sites across the region.
For the year ended March 31, 2019, Mitie Catering reported revenues of 136.1 million pounds and operating profit before other items of 5.2 million pounds.
Mitie said the decision to sell its catering business was after a strategic review of all business. According to the company, Mitie Catering’s long-term future would be better served by being part of a larger specialist catering group, rather than being self-delivered by Mitie.
The sale proceeds will be used to further strengthen Mitie’s balance sheet and reinvest in Mitie’s core business.
Phil Bentley, Chief Executive Officer, Mitie, said, “Mitie’s strategy is to invest in our core technology-led facilities management services – such as Security, Cleaning and Engineering Services – where we have a leading market position.”
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