Little Chef in hunt for new equity partner

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The Independent Online

A further shake-up in the motorway service industry was signalled yesterday after Little Chef revealed it was looking for new investors, while the owner of RoadChef continues talks to sell itself for £450m.

Little Chef, the roadside restaurant chain, said that after the ill-health of Lawrence Wosskow, one of the entrepreneurs who bought the business from Permira last year, the company was looking for a new equity partner.

Mr Wosskow and the chief executive Simon Heath acquired the company for £52m in October 2005 and then raised £59m by selling its freehold outlets.

Little Chef, which operates 235 restaurants alongside A-roads and motorways, would not comment on reports yesterday that it was burdened by high rents on the sold outlets.

A spokesman for the company said Mr Wosskow, who recently suffered a heart attack, is no longer involved in the business on a day-to-day basis.

"Mr Heath remains committed to the business and is actively seeking an equity investor to assure the company's ongoing success," he said. "Negotiations with a number of equity partners are already under way."

Meanwhile, Nikko Capital Investors, which owns the motorway service business RoadChef, is in talks with Delek - an Israeli multinational whose interests include fuel distribution and property - over the sale of the business. That would include £400m in equity and £50m in debt.

RoadChef, which was put up for sale several months ago, operates from 29 motorway sites, most of which include a Wimpy burger bar, self-service restaurant and a shop.

The latest moves follow the sale of Moto, the UK's biggest motorway services chain, for about £600m in April.

Welcome Break has also said that it would entertain a bid.

After a period of decline, service stations have invested heavily in recent years as they try to increase the amount of money that is spent by each visitor at the premises.