Agostini makes takeover bid for Prestige Holdings

Agostini Limited, which trades in pharmaceuticals, consumer products and energy, has made a bid for full acquisition of food service company Prestige Holdings Limited, PHL, via a share swap.

“Prestige Holdings is a major part of Caribbean hospitality. This acquisition unlocks immediate synergies – from shared distribution networks to enhanced scale – that will deliver value to both shareholders and, most critically, value to customers. We are committed to preserving PHL’s operational excellence while integrating its strengths into our growth framework,” said Barry Davis, Group chief executive officer of Agostini Limited.

Prestige Holdings operates 136 restaurants around the Caribbean. It represents brands such as KFC, Pizza Hut, TGI Fridays, Subway and Starbucks.

Under the offer, PHL shareholders will receive one Agostini share for every 4.8 PHL shares. It “represents a premium of approximately 31 per cent over PHL’s 30-day average price (27 per cent over today’s closing price),” the company said on Tuesday when it placed the offer on the market. The offer closes on July 21.

Both Prestige and Agostini are listed on the Trinidad and Tobago Stock Exchange. In the event of a full take up of the offer, Agostini intends to take Prestige Holdings private and delist it from the stock exchange.

Prestige Holdings is Trinidad & Tobago’s largest restaurant management company, with annual revenue of TT$1.35 billion, and the transaction, subject to regulatory approvals, will expand Agostini’s portfolio into the Caribbean’s thriving retail food and beverage sector.

“The company, as part of the Agostini Group, can benefit from synergies in areas such as imports, transportation, warehousing, marketing and other shared services,” Agostini Limited said in its Offer and Takeover Circular to PHL shareholders.

“These synergies can lead to cost savings in the above-mentioned areas through ordering and purchasing goods in bulk, maximising the current fleet of transportation vehicles by delivering to similar or near-by locations, fully utilising warehouse and storage facilities and combining shared services to lead to a centralized operating system,” it added.

Agostini Limited said the move is in line with the group’s regional expansion strategy, saying it would build on its presence in more than 10 markets, with exports to more than 30 jurisdictions.

Davis said that there is long-term value in the acquisition.

“PHL’s proven leadership in restaurant management complements the group’s diversified portfolio. We anticipate cumulative value through shared resources, improved cash flow and opportunities for market expansion, not just incremental revenue and synergies with Agostini’s existing retail operations. Having a broader retail and restaurant group will generate a stronger platform for continued growth in the region, he said.

Davis said there will be no interference with Prestige’s proven operating model, “and we have no plans to make any operational changes to PHL’s brands or staffing,” he said.

On Tuesday, the Agostini stock traded down at TT$64.50 on the Trinidad and Tobago Stock Exchange, while Prestige settled up at TT$11.18 per share.

CMC