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Buyout rumors can't buoy PizzaExpress stock

October 27, 2002

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LONDON -- Rumors that a private equity firm may have PizzaExpress on its shopping list aren't lifting the value of the company's stock.

As recently as Oct. 24, shares of PizzaExpress traded at £2.91 (U.S. $4.52) against a 2002 high of £9.21 (U.S. $14.30). The stock has fallen dramatically throughout 2002 in the wake of store sales declines since the terrorist attacks of Sept. 11. Pizza Express' metro London stores have suffered particularly from resulting drops in tourism.

According to the Times of London, insiders are speculating that Goldman Sachs is evaluating the 300-store chain's value on behalf of an unidentified suitor. The collapse in PizzaExpress' share price apparently has attracted the attention of venture capitalists.

The chain's chief executive, David Page, recently implemented a two-year turnaround strategy, which includes costly but needed store updates. However, scuttlebutt on the show floor of the Restaurant 2002 convention, held in London on Oct. 24, was that Goldman Sachs Asset Management may be one of a small number of disgruntled and now-united shareholders considering quicker ways of boosting shareholder value.