Whale swallowing Pizza Express

Ho Tianjiao

On July 12, Hony Capital, a PE unit of Legend Holdings, announced a wholly-owned acquisition of the entire equity interest of Pizza Express, a British restaurant brand, for approximately 900 million pounds (equivalent to approximately 9.55 billion yuan). This is the largest M & A deal in the European catering industry over the past five years. In addition to plans to help the brand to accelerate the global expansion of its brand, Lenovo also plans to help the brand vigorously explore the Chinese market due to the large market brought by China's urbanization and consumer upgrades.

In an interview with the reporter of the "First Financial Daily", Vice President of China Cuisine Association said in a front-page interview that Western food is stable in China at present and has not been affected by the domestic restrictions on "three public consumption" policies. However, some mid-to-high-end pizza Western food needs to be sold in China Vigorous expansion still needs to be cautious, this part of the market prospects may not be as optimistic as some foreign investors imagine.

Whale swallowing Pizza Express

Founded in London, England in 1965, Pizza Express is a casual lounge restaurant specializing in authentic Italian pizza. There are currently 435 stores in the UK and 70 stores in the rest of the world (mainly in the Mediterranean, Middle East and Asia), of which 22 are in Greater China (1 in Beijing, 9 in Shanghai, 12 in Hong Kong ).

A multi-year investment in the restaurant industry, told reporters: "Hony Capital, the reason why Chinese and Western pizza brand, personally think that nothing more than three reasons.First, Western food easy to standardize, better quality assurance and cost control premise Second, as far as the Chinese market is concerned, the consumer population of western food is relatively stable, unlike the fact that some high-end and medium-end consumer groups are complex and vulnerable to political and economic factors. Finally, the broad prospect of the Chinese restaurant market is taken as a matter of course European economic downturn, some of the assets in the doldrums may also be an important reason for the acquisition.

Hony Capital also acknowledged that it is a good time for cross-border investment in China. Zhao Huanhuan, CEO of Hony Capital, said that at present China has ushered in a systematic opportunity for cross-border investment and that Hong Yi should continue to be a "Chinese expert" under the background of deeper globalization. In the past ten years, more than 70 enterprises invested by Hony form a solid resource network.

Upon completion of the transaction, Hony Capital will help Pizza Express formulate and implement its global development strategy while using its local strengths to help Pizza Express expand its presence in China and expand its brand presence in China. At present, the national chain of pizza brands have nearly 1,500 stores. Richard Hodgson, CEO of Pizza Express, said that Asia, particularly China, plays a key role in the company's future. As an investor with rich experience in cross-border investment and outstanding resource advantages, Hony will surely bring the company to a new level.

"Imported" is not easy

According to Zhao Linghuan and Huo Jisen's speech, the Chinese market is the focus of Pizza Express development. However, to promote a per capita consumption of 130 yuan in the pizza brand in China is not easy.

Frontier said that for the moment, Western consumption in China is relatively healthy consumer groups, not because of "three public consumption" constraints and the impact of many current high-end catering as a result of "three public spending" led to a sharp decline in performance, and Western food in China Still have some prospects. However, the main pizza for the convenience of meals, fast food, per capita consumption reached 130 yuan. This is still relatively high in China. Take Taiwanese western food giant Wang Pin as an example, they have achieved some successes in developing western food in their native land, which is based on their Western-style dining patterns that favor Western-style dinner and are suitable for middle and high-end positioning. Even so, the expansion of Wang's flagship brand is relatively slow In fact, at present, Pisa is becoming less and less cautious in its domestic consumption pattern, its high - end dining atmosphere is very low and it is hard to walk in the middle and upper reaches. Shanghai and Beijing have a lot of pizzerias with a per capita consumption of only 30 yuan and the prices are not high.

"Currently Pisa is bigger than Pizza Hut, positioning itself as a casual snack, with per capita consumption being almost half that of Pizza Express, so individuals are not very optimistic about the prospects of large-scale expansion of Pizza Express in China," said Borderland. KFC, Pizza Hut and other restaurant chain parent Yum Sports Group recently released in the first quarter of fiscal 2014 earnings report, the first quarter of Pizza Hut in China same-store sales growth of 8%. YoY China-based same-store sales fell 20% YoY, while same-store sales in KFC declined 24% and Pizza Hut fell 2%. More than half of Yum!'s revenues come from the Chinese market.

In fact, Hony Capital's investment experience in the restaurant industry is not rich. A catering industry source said: "In recent years, Hony Capital has almost never seen investment and related industries can be remembered that many years ago invested in a fast-food enterprises, have not been well developed, and then consider the Therefore, we can see that Hony Capital's investment experience in the restaurant industry can not be considered rich. "To sum up, Hony Capital in order to Pizza Express successfully" brought in " Not easy.

Currently, Hony Capital has invested more than 70 companies, including Shijiazhuang Pharmaceutical Group, Zoomlion, CIMC, Suning Business, City Investment Holdings, Jinjiang shares. By the end of 2013, the total assets of the invested enterprises reached 1,650 billion yuan, the total sales of 536 billion yuan and the total profits and taxes of 37 billion yuan.