Bain Capital is looking to take a stake in French food caterer Sodexo after the Paris-listed firm said it was on the lookout for investors that could help fund the group’s turnaround, said sources.
Sodexo, which has a market value of $13.7 billion (12 billion euros), is looking to sell a minority stake of about 30%. The company is aiming for a turnaround on the back of increased demands. Employee benefit programs, meal vouchers and gift cards, have eaten into its profitability, said a source on the condition of anonymity.
As per the source, an auction process is scheduled to start this week, with Sodexo expecting other private equity firms to join the race.
As per its latest quarterly results, Sodexo’s unit delivered a 7% jump in organic revenues. The source said, Its valuation could exceed 2 billion euros, based on core earnings of about 200 million euros.
The company “would keep majority control of the benefits and rewards business, and “in this context we are currently studying various strategic options,” said Sodexo’s spokesperson.
Sodexo’s spokesperson ruled out plans for an initial public offering (IPO).
Sodexo, one of the world’s biggest catering companies alongside Britain’s Compass has been severely hit by the pandemic forcing it to cut jobs and halt dividend payments to stay afloat.
Unlike restaurants, caterers like Sodexo – which serves businesses, government agencies, hospitals, schools and event organizers – don’t have a direct relationship with consumers and have been unable to focus on home deliveries during lockdowns.
($1 = 0.8770 euros)