Electra to demerge TGI Fridays later this year

TGI Fridays owner Electra Private Equity has announced it will be demerging the brand onto the FTSE main market in the third quarter of the year, with plans already “well advanced”.

In the group’s interim results for the six months ended 31 March 2021, Neil Johnson, chairman of Electra Private Equity, said: “With the recent sale of Sentinel, we enter the final stage of our strategy with confidence, having returned over £2b to shareholders since October 2016. The new management teams at our two remaining larger portfolio assets, Fridays and Hotter, have performed admirably through the pandemic, not just sustaining their businesses in the most difficult circumstances, but also transforming them.

“In light of this, and their potential for further significant longer-term value creation, the board has decided that the optimal outcome for shareholders is likely to lie in a capital market solution for both businesses. It is our intention to demerge Fridays onto the FTSE main market late in the third quarter of this year and, subsequently, in the fourth quarter, to bring Hotter on to AIM through reclassification of the Electra entity. Plans are well advanced for both listings.”

Johnson described the business as “rejuvenated” and emerging from lockdown “a much stronger and more rounded business” with a strategy for sustainable growth and the opportunity for acceleration in the casual dining market.

The group said the first three days of business following reopening across England and Wales on 17 May has shown like-for-like growth of 76% against 2019.

The private equity firm confirmed plans earlier this year to offload the American-themed casual dining brand and the 87-strong portfolio it acquired in 2014.

TGIs is targeting growth of approximately five new sites per year as well as the expansion of its new cocktail bar brand 63rd+1st, with its Jailbreak Chicken delivery-only brand now available in 19 towns and cities.