Private equity funds are targeting Italy’s travel retailer World Duty Free after the Benetton family told last month that they are ready to halve their 50.1% stake in the group (through Schematrentaquattro which in turn is controlled by Edizione Holding) to lure potential partners. However the family was looking for an industrial partner.
Actually many private equity operators such as KKR, CVC and Permira have set their sight on the Italian Stock Exchange-listed company that manages travel retail activities in airports around Europe and that was born as a spin-off from Autogrill spa. However chances that private equity funds might win the game are few as an industrial partner might pay more for the deal as it might obtain huge synergies from a business combination.
Vice chairman of Edizione Holding, Gianni Mion, last week told the press that “if there will be a marriage, that will be for reciprocal convenience” and as for geografical origin of a candidate partner Mion said that “he might be from wherever. The sector has 3-4 big players and two are in Asia”.
Actually two of the potential partners are seen to be Lotte Dfs (controlled by South Korean Lotte conglomerate, is looking to expand its business in Europe) and luxury hotels Shilla Group, controlled by Samsung. Other candidates might be French group Lagardère and Swiss Dufry (which last June bought Nuance from Pai Partners and Italy’s Gecos holding, controlling Pam supermarket chain, see here a previous post by BeBeez) or finally Dubai duty free and Qatar duty free.
World Duty Free estimates to reach 2.4 billion euros in revenues in 2014 with an adjusted ebitda of 284 millions and a net financial debt of 950 millions while in 2015 revenues are seen to reach 2.63-2.67 billions with ebitda in a range of 279-294 millions, the company said last week presenting its strategic plan for 2015-2017 (see here the press release) which see net financial debt at 365 millions in 2017 and a 587 millions net cash flow with 3 billions in revenues and 355 millions in ebitda after 190 millions of investments in three years.
