LONDON, UK: Barkby Group (AIM: BARK) has completed the disposal of Workshop Trading Holdings Limited, trading under the Workshop Coffee brand by way of a management buyout (“MBO”).
The disposal follows the strategic update provided in July 2022, in which the Company announced its intention to focus on real estate and dispose of non-core businesses.
A full sales process was undertaken by an independent adviser, Castle Corporate Finance, which included consideration of an MBO led by Workshop’s founder and CEO, James Dickson. The sales process concluded that the MBO offered the best value for Barkby.
In the year ended June 2022, Workshop achieved revenue of £1.5m, a loss before tax of £0.8m and had net liabilities of £7.1m.
The MBO transaction includes the transfer of £1.7m of third-party liabilities, the repayment of £0.2m of intercompany lending and £0.3m of deferred consideration payable in cash in June 2024.
Barkby intends to utilise the proceeds of the disposal for general working capital purposes.
James Dickson, CEO of Workshop and leader of the MBO, is a substantial shareholder in the Company (holding 10.88% of Barkby’s issued share capital), a member of the Dickson family and therefore a relative of the Company’s Executive Chairman, Charles Dickson.
Accordingly, the MBO constitutes a related party transaction under Rule 13 of the AIM Rules for Companies. The independent Directors, having consulted with the Company’s nominated adviser, finnCap Ltd, consider that the terms of the transaction are fair and reasonable insofar as the Company’s shareholders are concerned.
Charles Dickson, Executive Chairman, said: “The sale of Workshop Coffee will enable its management team to maximise its potential, whilst ensuring Barkby is able to dedicate all of its resources and management time to the successful execution of its Roadside Real Estate strategy”.
Barkby Group has acquired Eliot Arms, a 19th century village pub