Hobson Audley wins tender for Wimpy Group’s secondary MBO

Hobson Audley has beaten off competition from a multitude of law firms and has secured a new client in the shape of the management team of Wimpy Restaurants Group.

The Wimpy Group has undergone a secondary management buyout (MBO) by a host of institutional investors consisting of 3i, Bridgepoint Capital and Lloyds TSB Development Capital, providing the management with an exit from the business. In the 1990s, the company underwent an MBO by the equity investors and three of the directors. Some of the existing management is being rolled over, but there is also new management being brought in. The current MBO is being led by John Davison, who is taking over as the new chief executive officer.

Hobson Audley underwent a competitive tender against other national and City law firms to secure the work. Corporate finance partner Edward Hoare and corporate partners Paul Taylor and Donald Stewart advised on the transaction. The firm was invited to pitch as it has a close relationship with chartered accountants Rees Pollock, which also acts for Wimpy’s management.

Bank of Scotland Integrated Finance backed the MBO and provided a combined debt and equity package worth £15m to fund the acquisition. DLA’s London office acted for the Bank of Scotland, led by banking partner Peter Crichton.
The firm’s corporate department, led by David Raff and Juan Perez Tejedor, also played a role as the firm drafted the equity documents not only for the bank, but also for the new managers coming in.

Hoare said: “The most interesting aspect was the fact that it wasn’t always easy to know who the client was.” The firm acted in one capacity on the acquisition side, for the management in acquiring shares from the directors and 3i, Bridgepoint Capital and Lloyds TSB Development Capital as well as for the management on the investment from Bank of Scotland Integrated Finance. At the same time, the firm was acting against the management as vendors on the selling of their shares. “We had situations where we could advise them and some where we couldn’t,” said Hoare.

Macfarlanes acted for the management vendors in this capacity as well as for the exiting equity investors.
Hobson Audley hopes to continue the relationship with Wimpy Group. “The company has a longstanding relationship with Thomas Eggar on property-related issues,” said Hoare. “But with relation to intellectual property and corporate matters, we’d hope we’re in with a good chance.”