Burger chain Five Guys hunts new investor to flip stake

The telecoms billionaire Sir Charles Dunstone is seeking caller investors to instrumentality a large involvement successful Five Guys Europe, the casual eating marque helium launched successful Britain much than a decennary ago.

Sky News has learnt that Sir Charles's concern vehicle, Freston Ventures, has retained concern bankers astatine Goldman Sachs to place a purchaser for a chunk of the burger chain, which employs astir 6,000 radical successful the UK.

This weekend, City sources said a involvement of up to 50% successful Five Guys Europe was apt to beryllium made disposable to bidders, though each options are expected to beryllium considered.

Teaser documents person been circulated by Goldman Sachs to imaginable bidders successful caller weeks, with ample buyout firms said to beryllium among those interested.

One insider said that based connected its projected earnings, the entirety of Five Guys Europe could beryllium worthy successful the portion of £600m.

The concern process has been facilitated by a woody that Sir Charles is understood to person reached to get the 50% involvement successful Five Guys Europe owned by the Murrell family, which established the concern successful Arlington, Virginia successful 1986.

Under that deal, Five Guys Europe volition wage a royalty interest to the US brand-owner for its aboriginal use.

Sir Charles brought the concern to Britain successful 2013, aft striking a woody with the Murrell household pursuing a household vacation successful New York.

Its archetypal UK tract opened successful Covent Garden, Central London, earlier hitting 100 outlets six years later.

The concatenation present trades from adjacent to 300 stores successful the European territories successful which it operates, which see France, Germany and Spain.

In the UK, it has 177 outlets, portion including the US concern it boasts much than 2,000 stores crossed 26 countries.

Five Guys Europe employs astir 9,000 radical crossed the Continent, and has plans to grow into countries including Italy and Portugal.

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Goldman is said to person been picked for the Five Guys Europe mandate aft overseeing the caller disposals of stakes successful Wingstop, the fried chickenhearted chain, to capitalist Sixth Street successful a £400m deal; and the Indian edifice radical Dishoom, which was backed by backstage equity steadfast L Catterton successful a transaction worthy astir £300m.

The motorboat of the process comes with the hospitality assemblage connected borderline up of the Budget amid fears of further rises successful concern taxes aimed astatine helping the Treasury capable an estimated £30bn fiscal achromatic hole.

Last year's Budget saw Rachel Reeves hike employers' nationalist security contributions, prompting employers successful the hospitality and retail industries to pass of wide occupation cuts and concern collapses successful its wake.

Since then, a drawstring of casual eating businesses person fallen into administration, including, astir recently, Pizza Hut's UK operation.

Other well-known chains, including Cote and TGI Fridays, person changed hands successful the past fewer months.

The pandemic sounded a decease knell for galore casual eating businesses, peculiarly successful the gourmet burger conception of the market, wherever Byron Burger has been done respective insolvencies successful caller years.

Five Guys Europe's show has bucked that trend, however, and present accounts for a ample stock of the UK's premium burger sector.

Five Guys Europe precocious completed a £185m indebtedness refinancing, which placed its borrowings connected a longer-term footing amid the challenging clime for edifice operators.

The institution is tally by John Eckbert, its main executive.

Sir Charles is best-known arsenic co-founder of The Carphone Warehouse and TalkTalk, the second of which helium remains actively progressive with and is presently engaged successful a process to sell.

This weekend, helium declined to remark erstwhile approached by Sky News.