Clapham House Share Discussion Threads

[zimzoot] 04/2/2008 09:22

indeed :)

I think they in it for a take over.....sooner then you think ;)

[liveinhope] 04/2/2008 08:01

Zimzoot - thanks for post. Well reasoned article. Still trying to work out who lost there nerve on this stock to allow Capricorn to acquire their stake so easily. IMHO I think Capricorn have bought well and may not take over CPH but make a very good turn on any future sale of thier holding. Time will reveal all. One to tuck away. As always DYOR.

[zimzoot] 01/2/2008 16:24

Clapham House Group take-out to be delivered soon

Having been savaged over the past month or so the shares of most major retailers are now looking a little deflated and the prognosis isn't exactly great as consumer spending does not look like it is going to be picking up anytime soon.

By Glynn Davis

Having been through the wringer the retail industry should have some sympathy for its contemporaries on the high street, the restaurant chains, who are expected to be hit possibly even harder than retailers from consumers choosing to keep their wallets shut a little more often and eating at home instead of spending on meals out.

Among those to have been hit pretty hard is AIM-listed Clapham House Group of which I admit to being a bit of a fan. Its model of buying proven restaurant concepts and then using its management skills and financing muscle to roll them out aggressively has proved attractive to investors. And so it came as a shock to find its shares drop around 40 per cent in a day after it issued a trading statement in early.

What caused this rout was its decision to adopt a more conservative opening programme for the financial year to end-March 2009 on the back of the uncertain economic outlook, potential food price inflation and recent increases in rents quoted for new properties. As part of this move it stated its intention to focus resources on growing its Gourmet Burger King brand (rather than the Real Greek, Tootsies and Bombay Bicycle chains).

This sounds to me like a sensible strategy that takes into account current circumstances but it did require analysts to pare back their forecasts and lower their valuations on the group. However, it undoubtedly suffered unfairly as it was one of the first companies to report an adverse effect from the slowdown.

It therefore took the full brunt of the market's pent-up negative feelings, which pushed its share price down to a low of 131.5p. Probably like many retailers, there is nothing fundamentally wrong with the Clapham House business and its model still looks attractive.

So much so in fact that the company's seriously depleted capitalisation soon caught the attention of predators that had been mooted to have been first interested back when the shares were at their high point for the year of 419.5p in May.

Clearly at a third of the earlier price restaurant investor Capricorn Ventures must have been salivating at the prospect of buying into Clapham House. As such it has taken no time to build up a stake of 29.9 per cent - above which it would have to make a formal offer for the group.

It has clearly recognised the value in the business, just as it did with PizzaExpress that it bought five years ago. Interestingly, it won that deal after beating a management buy-out team (consisting of its chief executive David Page and finance director Paul Campbell) who are the pair behind Clapham house. This certainly adds a nice bit of synergy to the current corporate activity.

Capricorn's stake building has helped push Clapham House shares back above the 200p level to stand at a current 207p. But with a take-out price likely to have to be around the 250p mark this appears to factor in a fair level of chance that a bid won't be forthcoming.

This seems the most unlikely scenario in my view, based on Capricorn's past form and the fit of the Clapham House assets into the Capricorn portfolio, which therefore gives investors in Clapham House some upside - as long as they didn't buy into the company prior to its fall in December of course.

This makes its shareholders among the luckier in the sector because it is at a time like this that both the restaurant and retail industries are in most need of investment vehicles such as Capricorn and private equity firms to liven things up a little. But it is the very nature of markets that they are particularly rare beasts right now.

[zimzoot] 28/1/2008 12:14

Smart money still buying :)

[zimzoot] 25/1/2008 19:18

Very Good :)

[lomax99] 25/1/2008 13:14

Also see Tempus, also in the Times:

[liveinhope] 25/1/2008 13:02

Shares drifting down from higher levels today. This from Times online (Business) worth a read:

[zimzoot] 25/1/2008 11:24

Indeed...spot on :)

Very thin market...Looks like they mopping up with small amounts

[lomax99] 25/1/2008 11:19

Numis reckoned that the offer would have to be in the £2.50 - £2.80 range, even though this has risen pretty strongly recently I would be disappointed with anything less that £3.10 - £3.30. Even at the upper end of the range I agree with a previous poster that Capricorn will be getting it on the cheap, expect it to be floated in 3 - 5 years at a significantly higher price following a continued, aggressive, roll-out of the GBK brand.

With Capricorn's previous/current experience with Pizza Express/Nando's I expect a bid shortly, they have not built up a 25% stake to take a back seat.

[zimzoot] 25/1/2008 11:09

One more attack....Caps away :)

[liveinhope] 25/1/2008 08:02

RNS announcement today confirms Capricorn holding now up to 24.93%.

[zimzoot] 25/1/2008 00:56

Looking Good :)

[liveinhope] 24/1/2008 09:00

Early rise again today. Something stirring? See 2 more GBK outlets opened recently. Cardiff on 17/1 + Didsbury on 22/1 so Management must be confident about this bit of business. Just need "feel bad" element to work it's way out of the economy !

[zimzoot] 23/1/2008 17:19

Expect a bidding battle :)

[liveinhope] 23/1/2008 16:24

lomaz99 - will be interesting to see who has actually bought in last few days.
Announcements awaited with much interest.

[lomax99] 23/1/2008 15:09

Scratch that, I missed the second large buy of 700k shares - now just under 25%, if all in Capricorn's hands.

[lomax99] 23/1/2008 14:17

Surely just over 23% in Capricorn's hands, presumably an opportunistic bid is imminent, to take advantage of current market jitters.

[zimzoot] 23/1/2008 12:24

Much in demand :) 2.5million i wonder who....

[zimzoot] 22/1/2008 15:24

Capricorn buying again :)

[zimzoot] 16/1/2008 23:16

90m offer last time :)

rurmor WH Ireland ... buying a 5 per cent stake for Capricorn ...

[zimzoot] 16/1/2008 23:12

more stake building :)

[liveinhope] 15/1/2008 08:07

smarm - why not Restaurant Group to be the next one to be taken over? Interesting times ahead in this sector.

[smarm] 14/1/2008 19:23

cafee - agreed. I am holding a few because no company builds up an 18% stake in a company that has just issued a 'slow down' warning without intending to do something. Has to be an upside there....and if not then I'll cut and run. I aways thought Carluccio's would be first to go...now I think it's gonna be CPH.

S

[caffe] 14/1/2008 16:17

SMARM- If there is a bid it will be good for all I will give you that! IMO this is the only way it will survive....understanding the formula or not...no punters means no turnover!!

Good luck to you if you are holding.

Caffe

[smarm] 14/1/2008 16:06

Caffe - look at the stake-building...looks like a bid on way and it's worth (whatever you think of the food) more than it's currently . And as for GBK - you obviously don't understand the forumla...it's upmarket macdonald's and my local heaves every night.

S