Off-licence chain Bargain Booze is eyeing a flotation on the Alternative Investment Market.
The retailer, which has 611 franchise stores under the Bargain Booze, Select Convenience and Thorougoods fascias and will float under the name Conviviality Retail, is currently owned by private equity firm ECI Partners.
It wants to raise between £60m and £65m. The funds would be used to buy out ECI Partners and other selling shareholders, as well as to repay all remaining debts to leave the company in a debt-free position, Bargain Booze said.
The chain wants to launch a Franchisee Incentive Plan through which Bargain Booze retailers will be awarded shares in the company. Shares will be given based on store standards, group EBITDA targets, KPI achievements and new franchisee incentives. It is expected the company will have a market cap of between £62.5m and £70m after flotation.
ECI Partners had put Bargain Booze up for sale, but abandoned its hunt for a buyer in April last year. In November it appointed Diana Hunter as CEO.
Hunter has since implemented a strategy to extend the company’s reach into new locations including Yorkshire, the North East, the Midlands and the south of England, as well as increasing the retailer’s convenience and wine offer. It is currently assessing the introduction of a larger store format that could act as a destination shop for purchases of bulk products.
“I see a great opportunity to grow this business through uniting and aligning the franchisees with the company, a most powerful force in generating optimal performance,” Hunter said.
“This together with development of our offer will drive the company’s growth. The innovative incentive scheme for franchisees and the appropriate capital structure will provide a firm foundation for the company’s plans,” she added.