Valora enters the booming fast-casual market in Germany

Valora Holding AG / Key word(s): Miscellaneous
Valora enters the booming fast-casual market in Germany

03-Jun-2022 / 07:01 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53
The issuer is responsible for the content of this announcement.


Ad hoc announcement pursuant to article 53 LR

Valora will acquire Frittenwerk, a trendy format based in Germany, thereby becoming an active player in the attractive fast-casual market. This represents the next strategic step in Valora?s evolution from a food service business focused on takeaway offerings towards experiential dining with familiar self-service processes. With Frittenwerk being an established brand, Valora aims to continue its expansion in this fast-growing catering segment and profit from the market?s development. Frittenwerk?s founding team is also convinced that together with Valora it will be able to strengthen the brand even further and accelerate growth.

Valora is further developing its food service portfolio and tapping a new market with its acquisition of Frittenwerk. Germany’s fast-casual market grew by an average of +9% per year between 2016 and 2019, meaning its development well outpaced that of the entire out-of-home market (+3%). Compared to the overall market, its growth is also expected to be disproportionate in the years to come. (Source: CREST Consumer Panel, npdgroup deutschland GmbH). The catering segment lies between quick-service and serviced restaurants. It combines a high-quality fast food offering with a feel-good atmosphere where people can both save time and spend time. With its fully developed self-service concept, Frittenwerk is one of the leading fast-casual dining chains of the German-speaking world.

High potential for scaling in an attractive environment

Since it was first founded at the end of 2014, Frittenwerk has focused on modern interpretations of Canada’s snack bar classic, poutine, while the menu is all about unusual dishes containing chips. As a first mover, the chip chain has great potential for further scaling. The concept even held its own during the COVID-19 crisis and continued to expand strongly with 12 new locations added during the years of the pandemic. This expansion can be intensified together with Valora, which plans to double the current network of 27 locations by 2025.

While Frittenwerk is mainly found in city centers at present, it also has locations in shopping centers and railways in large and medium-sized German cities. The location portfolio is still young and secured by long-term rental agreements. Most Frittenwerk restaurants are run as own points of sale, with more than a fifth run by private and institutional franchise partners. Valora sees additional growth opportunities, particularly through takeaway stores requiring little floor space at high-footfall locations. Expansion abroad is also conceivable. Thanks to uniform system standards and a low level of complexity, the concept?s further development is easily ensured.

A logical step in the expansion of the multi-format strategy

?The acquisition of Frittenwerk is a logical step in the expansion of our growth-oriented multi-format strategy,? says Michael Mueller, CEO of the Valora Group. ?Frittenwerk is a strong, popular brand in Germany and has a high level of innovative strength, not only in the hospitality sector but also in terms of digitalisation. We’re convinced that this format will allow Valora to quickly gain a foothold in the fast-casual market and benefit from the attractive market developments. Being a creative concept, we also expect a substantial amount of the know-how and expertise gained through Frittenwerk to carry over to our other formats.?

As the chain?s previous owner, Frittenwerk?s founding team is also convinced that both parties will benefit from the merger and experience a tailwind as they work together to take the brand to a new level. Going forward, Frittenwerk will be managed in the most decentralized way possible within the Valora Food Service division in order to maintain the strength of the chain?s own brand and promote its expansion in a targeted manner. The founding team will stay on board. The current employees will also be taken over and Frittenwerk?s head office will stay in Düsseldorf.

Frittenwerk?s takeover is expected to take place on 1 July 2022. The parties have agreed to maintain silence about the conditions of the transaction, which is being financed with existing funds. In 2021, the format generated external sales of over EUR 23 million and EBITDA of around EUR 2.5 million. Valora expects EBITDA to more than triple by 2025 due to scaling.

Picture credits: KIEPER FilmFotografie | Frittenwerk

About Valora
Each and every day, around 15,000 employees in the Valora network work to brighten up their customers? journey with a comprehensive foodvenience offering ? nearby, quick, convenient and fresh. The around 2,700 small-scale points of sale of Valora are located at highly frequented locations in Switzerland, Germany, Austria, Luxembourg and the Netherlands. The company includes, among others, k kiosk, Brezelkönig, BackWerk, Ditsch, Press & Books, avec, Caffè Spettacolo and the popular own brand ok.? as well as a continuously growing range of digital services. Valora is also one of the world?s leading producers of pretzels and benefits from a well-integrated value chain in the area of ​​baked goods. In 2021, Valora generated annual external sales of CHF 2.2 billion. The Group?s registered office is in Muttenz, Switzerland. The registered shares of Valora Holding AG (VALN) are traded on SIX Swiss Exchange AG.

More information is available at www.valora.com.

About Frittenwerk
The first Frittenwerk restaurant in Düsseldorf-Bilk already won the ?Railway Station Shop of the Year? award in its first year of operation and was nominated for the ?Leaders Club Award? as having one of the top six most innovative dining concepts. Years of development and learning followed before a second restaurant opened in 2016. Today, there are restaurants in Cologne (2x), Aachen, Frankfurt (2x), Essen (2x), Düsseldorf (4x), Stuttgart, Wolfsburg, Dortmund, Braunschweig, Karlsruhe, Hamburg, Oberhausen, Münster (2x), Neumünster (2x), Berlin (2x), Heidelberg and Leipzig. Restaurants will open in Mainz and Koblenz in mid-2022. The company?s own food truck, ?FRITTENWERK ? Der Truck?, has also been touring the country since 2018.

More information is available at www.frittenwerk.com.

If you have any questions, please do not hesitate to contact:

Disclaimer
This document contains forward-looking statements referring to topics that are not based on historical fact and cannot otherwise be proven by referring to past events. Forward-looking statements are based on our current expectations and assumptions and are subject to uncertainties as well as known and unknown risks. These uncertainties and risks, along with other factors, may mean that actual future events and developments, including Valora’s results, financial position and development, significantly deviate from what was explicitly or implicitly stated or assumed in the forward-looking statements. The information, opinions and forward-looking statements contained in this document only apply at the time of publication. Valora is not obligated to review or update forward-looking statements in light of new information or future developments or for any other reasons. This media release is not intended as a recommendation to buy securities.


End of ad hoc announcement


1367831 03-Jun-2022 CET/CEST

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