Outsourcing giant with a Cheltenham base makes £85million sale to strengthen balance sheet
By James Young | 19th August 2019
Outsourcing giant Mitie have announced that it is selling its catering division in a £85million deal.
The group who have a pest control base on the Battledown Industrial Estate in Cheltenham say the move is to strengthen its balance sheet and reinvest in their core business.
In an announcement to the London Stock Exchange this morning, Mitie PLC said that it had "entered into an agreement to sell its catering and hospitality business to CH&CO for a consideration of £85 million."
The deal with CH&CO, who are a contract caterer with a Royal Warrant from Her Majesty the Queen will see Mitie enter into a strategic partnership over the "Gather and Gather" workplace catering operation.
The announcement said: "The decision to sell Mitie Catering follows a strategic review of Mitie's business, focusing in particular on how to ensure that Mitie's clients benefit from the very best in catering choice and competitive pricing.
"This concluded that Mitie Catering's long-term future would be better served by being part of a larger specialist catering group, rather than being self-delivered by Mitie.
"This disposal continues Mitie's strategy of focusing and simplifying the Group's operations. The proceeds of the sale will be used to further strengthen Mitie's balance sheet and reinvest in Mitie's core business.
Phil Bentley, Chief Executive Officer, Mitie Group plc, said: "Mitie's strategy is to invest in our core technology-led facilities management services - such as Security, Cleaning and Engineering Services - where we have a leading market position.
"Gather & Gather is a niche player in the £4 billion UK contract catering market.
"By teaming up with CH&CO at this time, we believe this ensures the best choice and competitive pricing for our clients, whilst releasing funds for reinvestment and strengthening our balance sheet.
"The Gather & Gather management team will continue to lead the business and we look forward to working with them on delivering their unique offering to our existing clients and on future IFM opportunities."
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