Private equity firms buy bar operator Novus for £100m
Private equity firms LGV Capital and Hutton Collins have bought bar operator Novus Leisure in a deal worth £100m.
Novus has more than 50 bars, mostly in London, and last year bought troubled wine bar group Balls Brothers out of administration for £7.8m.
It was controlled by banks Barclays and Royal Bank of Scotland and has been trading strongly, last month indicating that it was set to make record profits of nearly £20m.
It has boosed profits by concentrating on ‘high margin' corporate parties and events of which food accounts for 35% of sales. The business has concentrated on ‘premiumising' its range of wine, cocktails and spirits and extending its trading window so that now 60% of revenue is now taken pre - 11pm.
LGV and Hutton Collins have backed the existing management team, led by Steve Richards (CEO). John Kelly will remain as non-executive chairman.
LGV, part of the Legal and General insurance group, already owns two pub companies - Amber Taverns and Liberation Group, which owns nearly 70 pubs in the Channel Islands.
Hutton Collins has been involved with hospitality industry buyouts including coffee chain Caffe Nero and restaurant group Wagamama.
Steve Richards, chief executive, said: "Novus has a resilient model that has served it well over the years. Our focus and investment in our pre-booked system has given us the ability to take market share and deliver predictable high quality earnings.
"These attributes have resulted in keen interest by the private equity community to invest in the next stage of Novus' development and in LGV and Hutton Collins we have secured investors who have an enviable record of backing successful businesses in the leisure sector. We really look forward to working with them over the next few years and to maximise the growth potential of Novus Leisure."
By Neil Gerrard
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