Compass Group’s $600m Acquisition of CH&CO

Food Service News

Compass Group’s Major European Acquisition

Compass Group, the world’s largest catering company, has taken a significant leap forward by acquiring CH&CO, a rival catering firm, for 475 million pounds ($603.73 million). This deal, which includes the assumption of debt, stands as Compass Group’s most substantial acquisition in Europe to date.

Strategic Expansion Amidst Post-Pandemic Recovery

The British multinational, Compass Group (CPG.L), announced the acquisition on January 22, 2024, as part of its strategy to expand through bolt-on acquisitions, especially in the wake of the pandemic’s impact. Compass Group’s CEO Dominic Blakemore emphasized the strength of CH&CO’s brand and its potential to drive market growth.

CH&CO’s Prestigious Portfolio

CH&CO, supported by private equity group Equistone, is renowned for its catering services across various sectors, including businesses, universities, and sports events. Among its notable clientele are the Royal Opera House, Abbey Road Studios, and the Royal Botanic Gardens at Kew in London.

Financial Analysts Weigh In

Barclays analysts have positively received the acquisition, anticipating improved margin dynamics and synergies following the integration. They also noted that the clarity brought by this acquisition could alleviate uncertainties related to earnings per share forecasts.

Future Growth and Synergy Potential

With the acquisition, Compass Group is set to absorb CH&CO’s extensive network, which boasts over 900 clients across 1,000 locations and an annual revenue of approximately 450 million pounds. CH&CO’s portfolio includes brands like Gather & Gather, Vacherin, and Company of Cooks. CH&CO CEO Bill Toner expressed optimism about the potential growth and benefits for clients resulting from joining forces with Compass Group.