City advisers make £25m in Hotel Chocolat deal

BANKERS and lawyers will share £25m in fees linked to Mars’s takeover of Hotel Chocolat, according to newly released filings.

Morgan Stanley, Lazard and boutique City investment bank Liberum are all in line to share in the awards, while “magic circle” law firm Freshfields Bruckhaus Deringer and Anglo-australian firm Herbert Smith Freehills are also in line for payouts. Mars struck a £534m deal to buy Hotel Chocolat in November, providing a boost to deal-starved City advisers who have faced a subdued year of takeovers.

US giant Mars is spending £8m on advisory fees paid to bankers and £6.4m on legal advice, according to filings.

Hotel Chocolat paid £8.8m for financial and corporate broking advice and paid lawyers £2m. Total fees for the entire deal, which include PR advice, accounting and financing costs, came to £28.5m. Hotel Chocolat, co-founded by Angus Thirlwell and Peter Harris, agreed to the 375p per share offer from Mars in mid-november.

The knock-out bid was a 170pc premium to the chocolate chain’s share price, well above the average premium offered for listed companies.

While a welcome boost for advisers, the fees paid on the deal are dwarfed by those paid in connection with the largest UK takeover this year, the £4.5bn buyout of Dechra Pharmaceutical by private equity group EQT. Both sides spent close to £150m getting the deal done in June.

Hotel Chocolat was founded 20 years ago as one of the first upmarket chocolatiers in Britain and has become a fixture on the high street. Hotel Chocolat and Mars declined to comment.