Hotel Chocolat is seeking valuation of £150m when it lists on Aim

Catherine Neilan
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"We know our chocolates are capable of cheering people up in the bad times" (Source: Hotel Chocolat)

Hotel Chocolat's co-founder has shrugged off concerns about the volatile state of the markets as the premium chocolatier gears up to go public.

City A.M. understands the business is hoping to secure a valuation of around £150m through the IPO, which will see joint founders and co-owners Angus Thirlwell and Peter Harris release a third of their combined equity.

This will enable the two founders to retain control - critical in a market in which "established British chocolate brands have been snaffled up by global buyers", Thirlwell told City A.M. "If we went an alternative route, we might put in jeopardy what Hotel Chocolat stands for," he added.

The two entrepreneurs are hoping to raise proceeds of £50m, £10m of which will be used to accelerate growth, specifically roll out further "proven" store formats, invest in its UK manufacturing capacity and improve its digital offering, including launching a new website this summer and developing its mobile and tablet offerings.

Growing the brand

Thirlwell told City A.M. there were "plenty of opportunities within the UK" across its range of store formats, including smaller travel format shops, chocolate cafes and restaurants. He declined to give a specific number of potential store openings, saying it was "an evolving picture".

Hotel Chocolat will also eye international growth, having opened three stores in Denmark. The business was "spoiled for choice" on where it could open next, Thirlwell said, although noted that its London stores showed US and Asian customers were already keen on the high end chocolate, which is manufactured in Cambridgeshire.


Although a number of businesses that have listed in recent months have done so at a lower-than-expected valuation, Thirlwell said Hotel Chocolat's "robust business" would stand it in good stead.

"I'm not a financial expert, but it strikes me that there's never an ideal time [to go public]," he said. "We are more focused on making sure our company continues to prosper, continues to be a strong brand. If we can do that, whatever the market conditions we should be able to find people who would like to invest in us.

"We know that our chocolates are capable of cheering people up in bad times."

The business, which operates 84 stores in the UK and abroad, posted revenues of £81.1m and EBITDA of £7.9m for its last financial year, ending 28 June 2015. It was founded in 1993, and has traded under the Hotel Chocolat brand since 2003.

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