Parent company set to demerge TGI Fridays before end of 2021

The private equity business behind TGI Fridays has said it plans to demerge the restaurant and bar chain later this year.

Fridays, as the chain was recently rebranded, will be lumped together with its upmarket sibling 63rd+1st as part of Hostmore Group.

Hostmore is set to demerge from the companies’ parent organisation Electra Private Equity, which snapped up the TGI Fridays chain in the UK in 2014.

It will be listed on the London Stock Exchange’s main market in the third quarter of 2021, Electra revealed, and will be led by chief executive Robert Cook and chief financial officer Alan Clark.

It marks a break-up of the Electra portfolio which the business believes will be the best for its shareholders.

“The board has decided that the optimal outcome for shareholders, and for further significant longer-term value creation, is likely to be to list Electra’s two largest remaining portfolio assets, Fridays and Hotter Shoes, on the LSE’s Main Market and (junior market) AIM, respectively,” the business said.

Since reopening to dine-in customers on May 17, Fridays sites saw a like-for-like growth of 12.5% compared with the same period in 2019.

It ran 85 sites at the end of last year.

The business has also opened a more upmarket brand, 63rd+1st, which it plans to expand in UK cities.

The first site opened last month and there are plans for another seven in city centres by the end of next year and scope for more than 20 by 2024.

Hotter Shoes, which targets customers over 55 years old, has seen sales rise 15% in the last month.

May 2021’s sales were 38% higher than the same month a year earlier.

Electra is set to update shareholders further at its capital markets day at the end of the month. Its shares fell 0.9% on Wednesday morning.