Apax Completes Somerfield Sale

Apax Partners, a global buyout house, has completed the sale of UK supermarket chain Somerfield to The Co-Operative Group for £1.565bn.

The other vendors in the Somerfield sale were Barclays Capital, the debt financing arm of the UK bank, and R20, the investment vehicle of Robert Tchenguiz. The transaction was first announced in July of last year.

Founded in 1875, Somerfield is the sixth-largest grocery retailer in the UK and has increasingly focused on convenience and local markets since the £1.1bn December 2005 take-private.

In the year ended April 26 2008, Somerfield had sales of £4.2bn and EBITDA of £233m. The business operates 940 stores across the UK and employs more than 40,000 staff.

Apax’s 2007 annual report declared that Somerfield was the fifth largest grocery retailer in the UK, with more than 1,000 stores and 44,000 (“approximately 50,000”) staff. Its turnover in 2007 was £4.38bn.

Apax said that close to half the debt incurred by the original buyout has since been paid off, with the balance repaid on acquisition by the Co-Op. In addition, the pension fund has had extra contributions and guarantees of £165m during the course of the transaction.

Source: Thomson Merger News