Bon Appetit PLC is an extremely successful chain of restaurants in UK with top class cuisine. However, at present times there are no further opportunities for growing business, so the management has decided to acquire an already established company in food industry. After a great deal of research and selection, The Corporate Strategy department come up with three possible takeover targets: Coffee Ground plc (UK) – a chain of coffee shops; Starlight plc – a chain of nightclubs/restaurants (UK); Mario Ferrino – a chain of delicatessens (Italy).
The report will look at the pass financial performance of the three researched companies; at the reports from the business magazines about the takeover targets of Bon Appetit PLC; and at recommendations on which company best suits to the main objective of the acquisition.
The past financial performance of the three companies shows that Starlight PLC registers a tendency of increasing its turnover, which is just under 3,9 million pounds for the first six months of the year. The other companies register a huge decrease in their turnovers. For instance, Coffee Ground’s turnover down by 1,8 million pounds. The Starlight’s share price is rapidly increasing for the past five years. The other two companies register a decrease for the last two years, more rapid for Coffee Ground. According to the charts, Starlight is the company with the biggest debt ratio and Coffee Ground with the lowest one.
Starlight plc is the company with the constant increase of its turnover and pre-tax profits for the last three years, because of its well-performing four new night clubs in the North of England. Coffee Ground shows disappointing results mainly due to the cutting back of its new stores and the stiff competition in the UK coffee shops’ market.
Bon Appetit PLC should acquire Starlight PLC...