Dixon strikes $200 million deal with KKR
US private equity giant KKR has bought into the Australian dining scene, acquiring former Spotless chief Bruce Dixon’s majority stake in his pub management group Dixon Hospitality.
The deal places a value on Dixon Hospitality at around $200 million which analysts expect will grow in the lead up to its listing on the stock exchange.
The Dixon Hospitality portfolio includes almost 50 leasehold pubs in Melbourne, Sydney, Brisbane and regional New South Wales with venues in Melbourne’s CBD, Toorak, South Yarra and Richmond.
The company had been looking at listing in a $186 million offer but subsequently shelved those plans to rustle up interest from private equity.
Mr Dixon was chuffed with the deal.
“We are extremely pleased to welcome KKR as an experienced partner,” Mr Dixon told the Herald Sun.
“We have known and held the KKR team in high regard for a long time, and their investment is a strong endorsement of the outlook for our business.
“We’re confident this partnership will position the company for long-term success.”
KKR is using its US9.3 billion ($A12.1 billion) Asian Fund III to make the investment in Dixon Hospitality.
“We are excited to work together with Dixon Hospitality’s experienced team,” KKR spokesman Scott Bookmyer told the Herald Sun.
“This is an exciting time for Australia’s hospitality sector and KKR is committed to supporting the business to achieve its long-term growth ambitions.” Dixon Hospitality’s Melbourne pubs include the College Lawn in Prahran, Imperial Hotel on Bourke St in the CBD, The Exchange in Port Melbourne and the Perseverance in Fitzroy.”
Mr Dixon is no stranger to private equity. He was running Spotless in 2012 when it was bought out by another private equity house, Pacific Equity Partners.
The Dixon deal adds to KKR’s other Australian investments which include Latitude Financial Services, formerly known as GE Money, and Perth-based Indian sandalwood group Santanol.
KKR has spent more than $3 billion in Australia.
by Leon Gettler, July 3rd 2017
