Former Boots boss launches Matalan bid
Former Boots chief executive Richard Baker is at the forefront of a £1.5bn private equity bid for out-of-town retailer Matalan.
Advent International, where Baker was recently hired as an operating partner, is the latest name to be added to the string of private equity firms believed to be circling the retailer.
Matalan, which specialises in discount clothing, was put on the chopping block by founder John Hargreaves last month – sparking a clutch of private equity firms including CVC Capital Partners and TPG to express their interest.
Matalan’s chief executive Alistair McGeorge and long term advisers PricewaterhouseCoopers are believed to have held early talks with a number of prospective buyers, but Hargreaves has ruled an end of the week deadline for all candidates to table their prices.
A successful sale would net Hargreaves a huge windfall on his investment after taking the retailer private in a £827m deal in 2006, following a period of underperformance on the stock market.
Hargreaves argued that the store would perform better under family ownership, and any sale would mark the end of his 24-year long ownership.
Matalan recently said that its earnings had jumped by 6.3 per cent in the year to end February 28 to £145.1m, as it enjoys the boom in trading from cash-strapped shoppers trading down to cheaper alternatives.
Hargreaves paid himself a £25m dividend for the period.
FAST FACTS MATALAN
Matalan confirmed that it was mulling a sale of the business last month in a move City pundits reckon will value the group at £1.5bn.
Atlas International, TPG and CVCCapitalPartners are believed to have held early talks.
RICHARD BAKER ADVENT INTERNATIONAL OPERATING OFFICER
RICHARD Baker joined Advent in August as an operating partner to advise the firm on investment opportunities across the retail and consumer sectors.
Baker previously held the role of group chief executive at Alliance Boots having been chief executive of Boots for three years before its successful merger with Alliance Unichem in 2006.
He subsequently oversaw the sale of the business to Stefano Pessina and buy-out firm KKR.
Baker pocketed a £6.5m windfall when Boots accepted the £11bn private-equity bid in 2007 so would be expected to invest in a new project.
At Boots, he was responsible for improving the company’s performance and growing its market share considerably.
Prior to Boots, Baker spent nine years at Asda Stores in a variety of positions, becoming chief operating officer in 2002.
He began his career at Mars Confectionery where he worked for nine years.
In 2007, Baker was appointed non-executive chairman of Virgin Active, the health club chain. He is also non-executive chairman of the European Advisory Board for Groupe Aeroplan, owner of the Nectar loyalty card, and non-executive director at the Whitbread hotel chain.