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Patisserie Valerie owner to raise £33 million in flotation

Cake shop chain Patisserie Valerie is set to roll out more new stores after unveiling plans to raise £33 million through a stock market flotation.

Patisserie Holdings, which also includes the brands Druckers and Philpotts, believes it has significant growth potential, having developed from eight shops in 2006 to 138 today.

It will use the proceeds of the proposed share placing to pay down debt, while the listing will enable existing shareholders to secure up to £55 million.

Entrepreneur and former Pizza Express chairman Luke Johnson is majority owner of the business after backing a management buy-out in 2006.

He said the rapid progress made in recent years and the opportunities that lie ahead made it an "exciting time" for the company to join the stock market.

The group's portfolio includes 89 stores under the Patisserie Valerie brand, as well as 22 under the Druckers name in the Midlands and North West of England and 23 from the recent acquisition of sandwich chain Philpotts.

Its main bakery is in Birmingham while it has a further six bakeries located at existing stores, with capacity to support up to a further 100 openings.

A further 12 stores are expected to open in this financial year, bringing the total for the year to September 30 to 20. New stores are typically profitable from the first month with average weekly sales of £14,000.

The first Patisserie Valerie cafe was opened on Frith Street in London's Soho district in 1926 by Belgian-born Madame Valerie, whose vision was to introduce continental patisserie products to the UK.

For many years, Patisserie Valerie was run as a small group by the Scalzo family consisting of a partnership of three brothers - Enzo, Robert and Victor.

They acquired the existing store in Soho, which had since relocated to Old Compton Street, in 1987 and took the group to eight sites.

Victor Scalzo still remains a shareholder in the company and is employed as operations director of its deli business Baker & Spice.

The current management team is expected to continue to hold a majority interest following the listing on the AIM stock market.

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