The London Bagel Museum, a famous domestic bakery brand, has been put up for sale. Although the company denies this, saying it is not a sale of control rights and is just a ‘simple investment attraction’, it is known that multiple strategic investors (SI) and financial investors (FI) have already received offers for the acquisition behind the scenes.
The London Bagel Museum is said to be seeking a ransom of 300 billion. A simple calculation based on operating profit shows that the EBITDA multiple (operating profit before amortization) is close to 24 times. Considering that even at its peak the food and beverage (F&B) industry’s EBITDA multiple was only 14 to 15 times, the corporate value presented by the London Bagel Museum is too expensive.
London Bagel Museum’s Jeju branch officially opens on the 23rd. /London Bagel Museum Instagram
According to the investment banking (IB) industry on the 26th, LBM, the operator of the London Bagel Museum, is exploring the possibility of selling management rights to some OSs and Financial Institutions.
Currently, LBM’s largest shareholder is director Lee Sang-yeop, who is known to own 51% of the shares. Director Kim Dong-jun (29%), Chief Brand Officer Lee Hyo-jeong (CBO, 15%), and current CEO Kang Kwan-gu (5%) are also major shareholders.
The sales structure and specific conditions are unknown. However, the desired corporate value of the company is said to be in the won range of 300 billion. The company recorded sales of 36 billion won and operating profit of 12.6 billion won last year. Although not correct, an EBITDA multiple of 24 times must be applied to achieve a value of 300 billion won.
In the C&B industry, 24x EBITDA is an unprecedented multiple. In the case of Mom’s Touch, which is trying to sell, a multiple of 9.5x was applied, while Burger King, which was said to be “too expensive” at the time of the sale, used a multiple of just 12 to 13 times. . 6 times EBITDA was applied to the price of KFC Korea, which was sold in January last year.
An official in the IB industry said, “The price of F&B companies is generally high in the United States, but even when business conditions were good, it was no more than 14 to 15 times.” “Does that make sense?”
The recent departure of the founders from the board of directors is also said to be a factor in the reluctance to take over. Another IB industry official said, “Key members have resigned from their positions as directors, and it is questionable whether the people who remain on the board are the key people.”
Recently, it was reported that CBO Lee Hyo-jeong, who created the London Bagel Museum brand, Lee CBO’s husband, former CEO Lee Min-wook, and the largest shareholder, Director Lee Sang-yeop, resigned from the board of directors LBM. Currently, CEO Kang Kwan-gu, director Kim Dong-jun, the second largest shareholder, and Oh Seong-je, chief operating officer, are on the board of directors.
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