US: Apollo acquires Smart & Final
Smart & Final, the LA-based non-membership warehouse store operator, has been acquired by an affiliate of the private equity group Apollo Management for US$22.00 per share in cash, which including debt obligations gives the deal a total enterprise value of $812.9m.
The deal includes the acquisition of the 55% stake in Smart & Final controlled by the French supermarket group Casino.
Smart & Final said its board had unanimously approved the transaction, which is expected to close in the second quarter of 2007.
"We are delighted to continue our dynamic growth programme with a new financial partner that will bring deep retail perspective to our team," said Smart & Final's president and chief executive officer Etienne Snollaerts. "Apollo's exceptional history of successful retail investing shows that we can leverage their experience to improve our operational metrics and return on capital."
Andy Jhawar, a senior partner in Apollo, said: "We have long admired the unique specialty food retail position of the Smart & Final and Smart Foodservice Cash & Carry stores. The company's position in the marketplace will serve as a strong platform for continued evolution and future growth of its business model. We look forward to working together with Smart & Final's over 6,000 employee associates to position the company for continued long-term success."
Smart & Final has also reported its financial results for the fourth quarter and full year. For the twelve-week fourth quarter to the end of December, the company posted sales of $491.4m, up 7.6% from the corresponding period last year.
Income from continuing operations for the quarter was $5.1m, or $0.16 per diluted share, compared with $9.4m, or $0.29 per diluted share, for the fourth quarter 2005. Comparable store sales growth for the 2006 fourth quarter was 5.7%, the company said.
For the full year 2006, sales reached $2.1bn, up 5.1% from 2005, on the back of comparable store sales growth of 2.8%. Income from continuing operations for the full year stood at $20.8m, or $0.65 per diluted share, against $22.0m, or $0.69 per diluted share, in 2005.
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