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March 9, 2012 2:39 pm
Andy Pritchard, the managing director of Iceland Foods, is poised to walk away with more than £120m from the sale of his stake in the value supermarket to a consortium led by Malcolm Walker, founder and chief executive.
Mr Pritchard, a key lieutenant of Mr Walker, sold his stake in the business, roughly 8.5 per cent, as part of Mr Walker’s £1.5bn deal to regain control of Iceland Foods. The sale had valued the stake held by Mr Pritchard, who is 53, and is retiring from the business, at about £128m, people familiar with the situation said.
Under the terms of the deal, Mr Walker and Iceland’s management will have about 43 per cent of the equity. Investors, including the Landmark Group, Lord Kirkham, founder of furniture chain DFS, and Brait, the investment vehicle of Christo Wiese, who owns a significant stake in South African retailer Shoprite, will hold 57 per cent, said people familiar with the situation.
Although management will have a minority stake, Mr Walker will have board and operational control of Iceland Foods.
The enterprise value of the deal is £1.45bn, as there is cash in the business, while the equity value is £1.55bn. The deal is backed with £860m of senior debt, provided by Nomura, Deutsche Bank, HSBC and Credit Suisse.
Mr Walker acquired the 77 per cent stake held by the two failed Icelandic banks, Landsbanki and Glitnir. He outmanoeuvred both supermarket and private equity rivals to gain control, and was advised by Rothschild and Daniel Yealland, the former Goldman Sachs retail specialist. Landsbanki was advised by Bank of America Merrill Lynch and UBS.
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