BC Partners, the private-equity group, is thought to have raised €101 million after selling down the rump of its stake in drinks and snacks group C&C. Una McCaffrey reports.
The London-based firm is believed to have placed 15.5 million shares, or close to 5 per cent of C&C, over the course of yesterday.
Market sources said the placing had been managed by Merrion Stockbrokers rather than by C&C's house broker, Davy. It is normal for house brokers to handle such transactions.
It is believed Merrion, which has produced a number of pieces of research on C&C, had carved out a substantial share of trade in the stock in advance of the placing.
BC Partners acquired its stake in C&C in 1999 when it led a buyout of Allied Domecq's stake in the company. C&C floated two years ago, with BC reducing its holding in a number of placings since then.
Yesterday's block of shares is thought to have been placed at €6.52, just below where C&C traded for most of the day. This price signals strong demand for the stock, with placings more usually completed at a more significant discount to trading levels.
The shares held up well towards the close, finishing the session at €6.62, up ten cent in a strong market. Total volume of almost 35 million shares was recorded in Dublin, although this is likely to have included some double counting.
BC is expected to confirm the disposal within the next few trading days. It was unclear last night how much stock the firm retained in C&C after the sale, if any.
It was equally unclear why the private-equity firm had chosen now to dispose of shares, with markets having weakened substantially over past months. The Iseq has shed 8 per cent since the start of May.
Over the same period, however, C&C has gained about 8 per cent. Much of the uplift has been attributed to C&C's defensive qualities, which make it appealing at times of market turmoil.
Defensive stocks tend to do well in falling markets because they do not suffer the same decline in demand for their products as other companies might.
C&C has received a particular boost on the back of its roll-out of Magner's cider across Britain.
In May, the company said it was aiming to double its market share to 1 per cent in Britain this year, having launched Magners across England and Wales at the end of March.
C&C also said at that stage it expected Magners to provide one of its main growth drivers in the coming financial year.
Research published yesterday by Merrion showed that the cider is performing strongly across a wide area in Britain. The broker surveyed 1,108 randomly-selected pubs across 10 British geographies and said the results could drive upgrades later this year.
The survey team found that Magners was available in 42.5 per cent of pubs across 10 mainly urban areas. Some 12 per cent of the pubs surveyed started stocking Magners within the past four weeks.
Merrion believes the popularity of Magners will make it difficult for competition to dislodge the brand once it is listed in pubs. The broker has a price target of €7.70 on C&C.
