Bloomberg report says Wyevale garden centre group owner is considering sale

Updated 29th August: Bloomberg has reported that private equity firm Terra Firma Capital Partners is looking to sell the recently renamed Garden Centre Group chain.

The private equity firm run by Guy Hands, bought the business two years ago. It recently returned to its former name, Wyevale.

Bloomberg said Terra Firma Capital Partners has held talks with potential advisers about a sale or initial public offering of the Garden Centre Group, which could value the company at as much £700m.

The former Garden Centre Group operates about 140 sites in the UK.

Bloomberg's report said a spokeswoman for Terra Firma had declined to comment, and a representative for Garden Centre Group did not immediately respond to telephone and e-mail requests seeking comment.

Commenting on yesterday's report from Bloomberg, Nick Bubb, retail consultant to Zeus Capital and member of the KPMG/Ipsos Retail Think Tank said: "Terra Firma bought the business quite cheaply in spring 2012 and after a much better year for the garden centre industry this year, thanks to the better weather, which means that profitability will have recovered well, you can't blame Terra Firma for wanting to take a profit."

City figures said they did not believe there was an active sale process in place.  However  garden retail experts suggested Terra Firma might take a high offer after finding out the realities of the garden centre business over the last two years.

HTA head of operations Martin Simmonds said: "If it’s valued at £700m, that’s not a bad return. The situation for a lot of businesses is if the right offer is there they will think about taking it."

He added if steps were taken to sell, it would not necessarily be a surprise: "The last two years have been a difficult two years for the industry as a whole and they've probably been exposed to some of that. The seasonality of garden centre industry is more noticeable than in other sectors they're in."

Terra Firma declined to comment on Bloomberg's report.

In a recent interview with HW, chief executive Kevin Bradshaw said Wyevale had a "full pipeline of future acquisition prospects" with new buys set to be announced over "the coming months".  He said: "The reality is it's a quite fragmented industry. As we develop our understanding of the market, my expectation is that you will find the majority of potential acquisitions are from independents and small chains in single or very small numbers."

Bradshaw said the group has a three-way strategy to drive sales - by "improving the strength of the core business", driving sales from existing centres and buying other centres.


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