A new wave of retail take-unders

I like the look of this deal.

The world’s largest duty-free shopping group, Dufry is buying Autogrill (one of the world’s largest owner and provider of airport concession and motorway catering services)

And the deal is akin to buying straw hats in winter…..considering that travel numbers are yet to recover, higher fuel prices are set to crimp motoring holidays and airport malaise continue.

These two companies know about the business of retail while you are in transit.

Once upon a time, Autogrill created a business called World Duty Free. After they de-merged it and floated it on Borsa Italia in 2013, Dufry acquired it a couple years later.

The Benneton family own 50.3% of Autogrill and they are happy sellers in exchange of Dufry shares and board representation. If you are not involved in a high-flying sector such as technology, this is a very good way for a 50.3% shareholder to find a happy home for their holding.

Sadly, the price offered to every other Autogrill shareholder is 8% below the prior day’s close of EUR 6.85.

Overall, Dufry has done well to to announce a take-under, rather than a takeover.

Although it seems challenging for a $3 billion market cap Dufry to swallow $2.6 billion Autogrill, it is a part stock and cash deal.

I’ll wait a few months for the deal to close and the merger to digest and check back if Dufry shares are cheaper than their current CHF 33.00 price.

July 11, 2022

by Rob Zdravevski



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