Dobbies takeover advantages weighed up as bid deadline arrives

Wyevale Garden Centres owner Terra Firma could recoup purchase price of Dobbies through sale and leaseback and other measures, say insiders.

Today is the first deadline for bids for Dobbies. Wyevale owner Terra Firma is believed to have bid £175m but sources suggest at least one other venture capitalist will bid and further bids could come in during round two.

Sources suggest Wyevale could make its money back through a sale and leaseback of some Dobbies centres.

Wyevale sold and leased back eight freeholds in December 2015 for £91m and has six sold and leased back from LaSalle, which subsequently sold them to Black Rock last year.

Dobbies has three joint sites with Tesco, not as many as widely reported.

Estimates continue to value the £153m turnover Dobbies at over £200m.

Wyevale said it had nothing to add on a bid, although it has expressed interest more than once in the last year in buying Dobbies.

Sources suggested other quick cost savings and business developments for Wyevale after a possible purchase could be to shut Dobbies' Edinburgh head office and cut management staff, introduce nationwide web ordering, introduce concessions to Dobbies, cut suppliers for cheaper ones, raise prices, add children's facilities such as soft plays, add catering concessions, cut staff hours and pay suppliers slower.
The speed of developments has surprised some and a quick deal could help Wyevale by deflecting from its annual results due in early July. Wyevale turned over £290m according to latest figures and has since grown by more than 10 centres to 153.

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