Patisserie Valerie eyes up Gail's takeover bid

Patisserie Valerie is reportedly planning to tap investors for £35mn to buy Bread Holdings, the parent company of artisan bakery chain Gail’s.

Patisserie Holdings, which is listed on the London Stock Exchange (LSE), has a current market value of just over £350mn and, as a result, it could organise the placing without giving existing shareholders the right to pre-empt it.

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Entrepreneur Luke Johnson, chairman of Patisserie, has a majority stake in Bread Holdings, which includes the chain of artisan cafes and wholesalers Bread Factory.

A deal is unlikely to be agreed until March, according to insiders, and Mr. Johnson will not be involved in the negotiations because of the potential of a conflict of interest.

According to industry sources, Bread Holdings, which includes Gail’s and wholesale business Bread Factory, could have a price tag value of around £150mn.

Following the reported takeover talks, Patisserie Valerie's’ share value rose sharply.

According to MCA’s Branded Bakery Market Analysis, sales in the bakery segment were predicted to grow 3.6% in 2017, with the market set to reach a value of £1.4bn.