Centerplate Continues Search For Buyer, Reports $10M Net Loss
By Don Muret, Staff Writer, SportsBusiness Journal
Big league concessionaire Centerplate continues its attempt to find a buyer for the company, a process that could take two to three more months to complete, the firm's CFO told investors during Wednesday's Q2 earnings call. "It's a rigorous process," said Kevin McNamara, filling in for President & CEO Janet Steinmayer, who was not on the call because of a family medical emergency. "We still have work to do and will announce the outcome as soon as we have completed the process." Centerplate hired UBS Investment Bank in May to explore a possible sale. UBS issued a book for prospective buyers listing the food and retail provider's contracts at 22 major league facilities and its deals at other arenas and stadiums, but the book did not delve deeply into Centerplate's liabilities and other critical data, said sources who have seen the document. The lack of financial details tied to those contracts has apparently cooled interest within the industry, and sets up a scenario where an investment firm outside sports could pay a premium for Centerplate, sources said. They cited American Capital's purchase of 83% of facility manager SMG for $631M in '07 as an example. McNamara said he could not comment on the process until it is completed, but added that Centerplate has kept in touch with its clients to "keep them informed as best we can."
SECOND QUARTER NUMBERS: Centerplate reported a net sales increase of $37.5M for Q2 compared with the same period in '07, primarily due to the opening of Nationals Park in DC, a Centerplate account. The company reported a net loss of $10.1M, compared with a loss of $5.8M in Q2 '07, a decline due in part to the $3.3M in fees associated with amendments to the firm's credit agreement and higher interest expense. If a buyer is not found by October, Centerplate will need to secure a further amendment to its credit facility to continue paying interest on the bond portion of its income deposit security stock, which combines common stock with a bond. The company quit paying stock dividends in June.
|
