In the summer of 1992 Rocco faced brickbats after the combined sale of the contract caterer, Gardner Merchant, and Forte's airport services business to Compass Group fell through. In the past, Rocco had bought a pig in a poke with the Kennedy Brookes chain of restaurants, which may have taught him about value and the need to focus on branded hotels and roadside restaurants.
Rocco said no to Compass: the company could do better than the pounds 500m offered and with fewer conditions attached to the sale. By Christmas, Gardner Merchant alone had been sold to management for more than pounds 400m while Forte retained a 25 per cent equity stake in the operation. Plans are now near to fruition to float airport services, renamed Alpha, on the Stock Exchange in January for a rumoured pounds 200m or more. Rocco was right.
Yesterday Forte sold its half- share in the UK arm of Kentucky Fried Chicken to its partner, Pepsico, for about pounds 40m, equivalent to a tasty 25 times after-tax earnings and pounds 35m more than Forte paid for its stake in 1985.
Things may be looking up on another disposal. They laughed when Forte suggested that pounds 120m, equivalent to pounds 1m an outlet, was a fair price for its Harvester pub restaurants. Now Forte says it has just turned down a pounds 110m offer for the chain. Like father?Reuse content