The founders of high-end chocolate company Hotel Chocolat are in for a sweet payout of £140 million each, after agreeing a half-a-billion pound buyout from US confectionary empire Mars today.
Mars will pay £534 million for the chain, which started selling chocolate online back in 1993 before opening its first shop in Watford in 2004. More than half of that total will be shared between co-founders Angus Thirlwell and Peter Harris. as both own a 27.1% stake in the business.
Thirlwell, who is also CEO and will remain in that role post-takeover, will reinvest his £140 million in the business.
He told the Standard the sale to the multi-billion-dollar American giant wouldn’t mean a change for customers.
“Mars shares key values with us, including in quality and sustainability,” he said. "A decision like this would never be taken lightly.”
A Mars bar contains about 60 grams of sugar per 100 grams, but Thirlwell said the company shares the same values that he does, noting a $1 billion investment in the sustainability of the Mars supply chain.
Andrew Clarke, global president of Mars Snacking, said: “From a Mars perspective, quality and sustainability are fundamental.”
The agreement also marks another company being taken off the London stock exchange, bought out by foreign capital that saw its London-listed shares as undervalued. The all-cash deal, at 375p per share, is well over twice yesterday’s closing price for the chain.
Stephen Alexander, Chair of Hotel Chocolat said: “Hotel Chocolat is a brand with strong long-term prospects and today's deal will allow it to grow further and faster. Joining forces with Mars will deliver great value through the Cash Offer for Hotel Chocolat shareholders and the combination will create exciting opportunities for Hotel Chocolat employees as part of Mars.”
Hotel Chocolat struggled in the past year amid difficulties in Japan. Today its board said the acquisition “could provide the Hotel Chocolat brand with an enhanced platform for growth in the UK and potentially in new geographies”.
Clarke said: "We have long admired the fantastic business that Angus, Peter and the Hotel Chocolat team have created. Hotel Chocolat is a differentiated and much-loved brand, with an impressive product offering and a deep commitment to its values of originality, authenticity and ethical trading.
“ The Mars and Hotel Chocolat businesses are highly complementary, and during the course of our discussions with Hotel Chocolat's leadership it has also become clear that there is a very strong cultural fit - with purpose at the heart of both organisations, and a shared passion for quality and sustainability.
“Mars has a long and proud history in the UK, and today's announcement further strengthens our commitment to this important market by bringing an exciting brand into our portfolio and deepening our relationship with consumers. Building on the strong foundations that Angus, Peter and their team have established, we are very excited to support Hotel Chocolat's next phase of growth.”
“We are confident that Mars will be an excellent long-term home for Hotel Chocolat, providing a like-minded, entrepreneurial and purpose-led environment in which to maximise the potential of the Hotel Chocolat brand which is already so beloved by consumers."
The deal is expected to close in the first quarter of next year.
