30 Aug 2011
Bunzl plc, the international distribution and outsourcing Group, today announces that it has disposed of Provend Group Limited and its subsidiaries (including Bunzl Vending Services Limited) to Autobar UK Limited. Based in London with operations throughout the UK, Bunzl Vending Services is engaged in supplying, servicing and operating food and drink vending equipment and systems.
Bunzl entered the vending sector, which is both more capital intensive and less resilient than other Bunzl businesses, in 1999 with the purchase of Provend Group. At the time Provend Group also included a large foodservice distribution business that expanded Bunzl’s existing catering supplies operations. Since then, although the Company has further developed the vending business, it is restricted to operations solely in the UK. As the Group’s strategy is to focus its resources on areas where it has or can develop real competitive advantage, the Board concluded that the vending business was no longer a strategic fit within the portfolio of the Group’s businesses.
The disposal will generate a net cash inflow of approximately £30 million. Revenue of the business was £33.2 million in the six months to 30 June 2011 and in the same period the operating profit before intangible amortisation was £nil. Based on the estimated net assets disposed of, a loss of approximately £55 million is expected to arise which will be recorded in the financial statements for the year ending 31 December 2011.
Commenting on the disposal, Michael Roney, Chief Executive of Bunzl, said:
“The Board decided that it would be in the best interests of our shareholders to divest our vending business as it was no longer considered to be a strategic fit within the Group and that the funds generated from a disposal would be more usefully employed in our core, higher return and higher growth businesses. We are pleased that the business has become part of a European market leading vending group where it can continue to develop further.”