Media speculation on which companies – including travel retail players Dufry and Lagardère – might bid for a stake in, or merge with, World Duty Free, sent the share price racing up this week to close at €9.77, up +10.4% on last week. Lagardère tells TRBusiness that “a merger with WDF makes a lot of industrial sense” (see below).

 

The closing price is above WDF’s €9.21 price in October, before it crashed to an all-time low.

Yesterday, Bloomberg reported that Dufry was considering an acquisition bid if it was able to buy the 50.1% stake held by Edizione, the Benetton family-controlled Italian holding company whose principal retail businesses are Benetton Group, Autogrill and WDF.

However, to date, WDF has only referred to “potential business combinations” rather than the sale of any controlling interest. In mid-January Reuters said that according to its sources the Benetton family was ready to halve its stake in WDF, but not relinquish it completely.

Yesterday the news agency also named French media group Lagardère as a competing suitor for WDF. It claims that according to “sources familiar with the situation” Lagardère has appointed Societe Generale for financial assistance in pursuing a deal.

“NOT AT ANY PRICE”

Lagardère Services, the division of the French conglomerate which houses the DF&TR unit, LS Travel Retail, has been looking for a big acquisition. Last July, a month after Dufry announced it had sealed a deal to snap up another big travel retailer, Nuance, for $1.7bn, CEO Dag Rasmussen told TRBusiness that he had definitely seen Nuance as an attractive target “but not at any price”.

Today Rasmussen did not comment on the bank appointment, but he reiterated his stance to TRBusiness: “A merger with WDF makes a lot of industrial sense, but the price for the time being is too high. We have not found a solution as yet.”

Reuters says that Lagardère is currently in talks with private equity firms to help it fund a deal worth over $1.2bn, according to another of its sources. Just last week, Rasmussen said in the TRBusiness Annual Survey (see the January print issue) to expect the company to potentially complete numerous acquisitions in 2015 as well as the integration of “new activities” from 2014.