Matalan sale plans on hold

Feb 12 2010 by Peter McCusker, The Journal

DISCOUNT retailer Matalan has put sale plans on hold as would-be buyers baulked at the £1.5bn asking price.

Interest from a trio of private equity bidders failed to drum up a big enough offer for Matalan founder John Hargreaves, who has “closed down the potential sale process” for the business.

The news came as Travelport, the US owner of travel brands Galileo, Worldspan and Octopus, pulled plans for a £1.2bn float.

Both moves could dent hopes of recovering takeover and flotation activity this year following Kraft’s successful bid for Cadbury, KKR’s deal for Pets at Home and fashion retailer New Look’s plans for a stock market launch.

None of Matalan’s three potential buyers – TPG, Advent or Warburg Pincus – was prepared to pay more than £1.3bn for the business, according to the Financial Times.

Mr Hargreaves opened the first Matalan store in Preston in 1985 and took the 203-store chain private in an £827m deal in 2006. The sale will be postponed until market conditions improve.

Travelport however, failed to garner enough support from institutional investors.

Travelport chief executive Jeff Clarke said: “There has been significantly increased volatility and uncertainty in global equity markets. We will consider bringing it back to the market at a future date.”