Dufry Group has signed an agreement to acquire the remaining 49% equity stake of Hellenic Duty Free (HDF) from Folli Follie Group (FFG).
In April 2013, Dufry Group acquired 51% of Hellenic Duty Free, the leading travel retailer in Greece. Dufry Group will pay a total of €328m ($452) through a combination of cash and shares.
The transaction is expected to enable Dufry Group to achieve additional synergies by further streamlining the group’s logistics and purchasing processes. Dufry Group will also refurbish and expand retail space in key airports in Greece, including space at airports in Athens, Thessaloniki, Rhodes and Crete.
The transaction will allow the full financial integration of HDF, where Dufry Group expects substantial benefits in cash management as well as a reduction in yearly financing costs of SFr10m on a comparable basis.
The cash portion of the transaction will be €175m ($241m). Dufry will issue 1,231,233 ordinary shares from its authorized capital to FFG in the transaction, which the parties have valued at €153m ($210).
FFG intends to join the group of shareholders led by Travel Retail Investments SCA. The Board of Directors of Dufry Group has also agreed to nominate George Koutsolioutsos for election to the Board at the 2014 Annual General Meeting.
In connection with this transaction, Dufry Group has entered into a new €500m ($689m) term loan with a group of banks for a duration of five years. The proceeds of the financing will be used to finance the cash portion of the acquisition consideration, as well as to repay HDF’s local bank financing in Greece.
Dufry CEO Julian Diaz said: “This announcement could not have been a better milestone to complete the year of 2013, which was full of important achievements for the group. The acquisition of the remaining 49% of Hellenic Duty Free allows us to achieve further synergies on the operational level and generates financing savings. With Folli Follie Group joining as a long-term shareholder of Dufry Group, we further strengthen our core shareholder base.”