13th Feb 2020 09:20
(Alliance News) - Domino's Pizza Group PLC on Thursday said that it will completely exit its Norwegian business as part of the UK-based master franchiser's plan to exit international operations.
The pizza chain has agreed to sell its entire 71% shareholding in DP Norway AS to existing minority shareholders Pizza Holding AS and EYJA Fjarfestingafelag III EHF for a nominal NOK1 in cash and the transfer by minority shareholders of their entire shareholding in Domino's Swedish business to the company.
It doesn't plan to hold onto this permanently, however. Domino's Pizza said the transfer of the minority interests in Domino's Sweden "is expected to simplify DPG's disposal of its Swedish business in due course".
Domino's Pizza said it will need to make a cash outlay of up to GBP7.0 million as part of the sale, comprising of Domino's Norway's marketing campaign costs, certain future liabilities, and cash retained by the disposed business.
The FTSE 250-listed company expects its Norwegian exit to complete by May-end, subject to shareholder approval at an early May general meeting. It said its entire board, as well as US brand owner Domino's Pizza International Inc.
Domino's Pizza Norway reported an underlying operating pretax loss of GBP6.6 million for 2018, and the UK parent said it also has agreed to cover its losses until completion of the deal.
Domino's Pizza Chief Executive David Wild said: "This transaction is positive for all stakeholders and also provides DPG with a clean exit from Norway following operating losses and high levels of capital expenditure over a number of years. The new owners have exciting plans for the business and importantly, the Domino's brand will retain its presence in Norway.
"Now we have agreed the transaction for Norway, we will focus on progressing transactions for our businesses in Sweden, Switzerland and Iceland. We are focused on securing the best possible terms for shareholders and are working closely with Domino's International throughout."
Shares in Domino's Pizza shares in London were down 0.4% at 305.70 pence each on Thursday morning.
By Tapan Panchal; [email protected]
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