Oakman Inns and Restaurants raises £5.5m and hires new finance director

Oakman Inns and Restaurants has appointed a new finance director, as it also sealed a £5.5m round of funding.

The business, which has eight sites in Hertfordshire, Oxfordshire and Buckinghamshire, will see Joseph Evans, currently financial controller of Whitbread Hotel and Restaurant division join Oakman in February 2014.

Evans has spent 13 years at Whitbread and leads 110 people as part of his role in Whitbread, in a division with an annual turnover of £1.4b.

Oakman chief executive and founder Peter Borg-Neal said: "The fact that he is leaving such a major post to join us for the next part of his career is testament to the esteem with which Oakman Inns is held across our industry and the very exciting future we are building towards. Joseph shares my vision of building a ‘best in class' business that can deliver a tremendous outcome for investors, employees, suppliers and customers alike."

Meanwhile, Borg-Neal said the business had succeeded in raising £5.5m - a process it tried to begin in April 2012. Borg-Neal said the task had been made even more difficult because the company's bank, RBS, had been "unsupportive".

"We started looking for funds in April of 2012 and received a number of offers from various private equity sources. However, none of the offers reflected the fundamental value of our business and, despite the pressure, I was determined not to sell out too cheaply. The decision by the Government in the 2012 Autumn Statement to extend the Enterprise Investment Scheme provided the opportunity we needed. In February this year we launched a new EIS fund-raising round," he said.

The company had originally targeted an investment of £4.5m, but as a result of impending acquisitions it upped the target to £5.5m.

"This leaves the business with a very strong balance sheet with circa £7m of equity, £3.9m of shareholder loans and only £1.2m of bank debt (all of it secured via EFG and freehold property). We believe the value of the business, net of debt is around £15m and our freehold property alone is worth over £7m," he said.

Oakman opened its sixth site, the Beech House in Beaconsfield, earlier this year, investing £800,000. It also invested £3.5m in the acquisition and development of the Crown & Thistle in Abingdon-on-Thames.

Oakman Inns and Restaurants to hit £9m turnover in 2012/13 >>