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Nicholas Marshall flotation hope for Garden Centre Group

Garden Centre Group chief executive reports a healthy interest in the chain with its sale on track for Christmas completion.

Garden Centre Group chief executive Nicholas Marshall says his "secret wish" for the 130-centre chain, which is for sale at £300m, is for it to go public after it is bought.

Marshall, speaking after initial bids came in for the group, said: "I hope the company will go public again, using our garden club as a basis for our shareholders list. We can have three to four million members in another couple of years."

Around 11 bidders are believed to have responded, including private equity firms Bridgepoint, Terra Firma and Duke Street Capital as well as retailer Morrisons. Marshall said he had not put a bid together with backers and all he wanted from a prospective buyer was that they would look after the company and keep him in charge.

He added: "Frankly I don't need to bid because there are lots of people interested. I can't go into detail about who is bidding and who isn't at the moment because that would be unfair.

"We are unique and it's a one-off opportunity. We're all very optimistic because considering where the economy is and the international financial situation I think people see us as a very exciting asset."

Marshall continued: "I'm keen that it goes anywhere where it will be in safe hands and people will look after it and help us look after it."

He said the timetable was to complete the sale by Christmas. Rothschilds is looking at all the bids and reporting to the bidders to work down to just one. "It's now out of my hands," said Marshall.

There was "still a lot to do" such as the full implementation of click and collect, he said, which he regarded as "one of most significant things we've ever done".

"Click and collect enables every one of our garden centres to offer the same product range as Bridgemere. So effectively, if you walk into any of our garden centres you will be able to say have you got "x" and it will either be on a shelf or we can get it in a short period of time.

"There is a vast range of plants that no-one else will have. My aim is for us to become the serious garden centre for the very serious gardener. That's where we are going to win because 95 per cent of the population in England and Wales is within 25 miles of one of our centres.

"We can do click and collect and they only have to drive up to 25 miles to pick it up. We will have 30 types of hydrangea available for customers from Hastings to Heighley Gate, which is pretty powerful."

Retail commentators weigh up private equity option:
"The best outcome for Garden Centre Group (GCG) is for someone who understands the market and is prepared to invest. The ethos of private equity is to make as much as you can in a short space of time. That can work, provided their expectations aren't too unrealistic and there is good management on the ground, which there is at GCG at the moment."

Neil Gow, director, garden industry manufacturers' association

"Morrisons is developing its non-food business and there is a precedent in Tesco buying Dobbies but there is little evidence that has been a particular success. A private equity buyer is more likely. Big ticket, housing-related purchases are not high on people's agendas. Investors aren't keen on retail and the IPO (initial public offering) market is dead."

Kate Calvert, retail analyst, Seymour Pierce

Source : Matthew Appleby – Horticulture Week

28 October 2011
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