Compass Group PLC, a global food service company, has signed an agreement to acquire CH&CO, a provider of premium contract and hospitality services in the UK and Ireland, for an initial enterprise value of £475m/$600m.
CH&CO has a highly regarded management team and a long track record of strong performance, delivering a bespoke and high-quality food offering through several sector brands. The company currently generates annual revenues of c. £450m/$570m and operates across a range of sectors, including Business & Industry, Sports and Leisure, Education, and Healthcare. CH&CO has a diverse client base and broad geographic spread which would complement Compass Group’s existing footprint in the UK and Ireland.
“CH&CO is a highly regarded food service business in our industry. This proposed acquisition combines the best of the two companies: our shared passion for people, great food, and focus on sustainability," said Dominic Blakemore, Group CEO of Compass Group.
"With CH&CO’s strong brand identity and a broad geographic reach, we would be able to further enhance our customer proposition, helping us capitalise on the significant growth potential in the market.”
Blackmore said that the proposed acquisition is in line with the company's longstanding strategy to create value through disciplined capital allocation. He added that CH&CO has a strong cash generation and balance sheet that has provided it with the flexibility to invest in organic growth and to acquire high-quality businesses with exceptional management teams, enabling it to further accelerate growth and enhance shareholder returns.
Bill Toner, CEO of CH&CO said he was delighted that Compass wanted to acquire CH&CO, and that the prospect of joining a leading global provider of food services had offered future potential for the company and its clients.
"Creativity and innovation are skills that we share with Compass, and food is at the heart of everything we do,” said Toner.
“Both businesses have strong and complementary brands, and subject to regulatory approval, there is a great opportunity for us to learn from each other and to build an even more exciting future together.”
