October 25th, 2017

LIVING VENTURES EYES UP STEAKHOUSE DEAL

By Insider Media Limited

LIVING VENTURES EYES UP STEAKHOUSE DEAL

The chief executive of Living Ventures Group, whose brands include Gusto, The Alchemist and Red Door, has told Insider that another private equity deal could be on the cards next year to expand steakhouse business Blackhouse.

Jeremy Roberts, who co-founded Living Ventures with the late Tim Bacon in 1999, has played a key role in building up several hospitality brands down the years. An early success was The Living Room which was created and launched in Manchester in 1999 and later sold to Ultimate Leisure for £28m in 2007.

The Knutsford-headquartered bar and restaurant operator also acquired Est Est Est in 2005 and rebranded the chain as Gusto in 2007. Gusto then underwent a management buyout in 2014, with mid-market private equity firm Palatine taking a majority stake in the business.

LIVING VENTURES EYES UP STEAKHOUSE DEAL

Similarly, Living Ventures launched The Alchemist in Manchester in 2011, which underwent a £13m management buyout backed by Palatine in 2015.

Now attention is turning to Blackhouse, which currently has two sites in Manchester, one in Leeds, one in London and one in Glasgow that all trade under the name 'The Grill on...'. Living Ventures recently relaunched the Blackhouse brand and has refurbished all of its restaurants apart from the Glasgow site, which is yet to be revamped.

Roberts said: "Blackhouse came out of our acquisition of Est Est Est and we've been trading the business for many years. We're now looking to start to expand that business next year and that'll be a refinancing led by managing director Scott Grimbleby. It might be a joint venture, it might be a straight banking deal, but private equity is our usual option.

"I think the steak market is dominated by casual dining offers like say Miller & Carter and then the other end of the spectrum is Hawskmoor and Gaucho but there's never been very much in the middle and we think we operate in that area. We're not much more expensive than Miller & Carter but our offer is much better.

"We're very excited about Blackhouse because we think that's going to exploit a gap in the market."

LIVING VENTURES EYES UP STEAKHOUSE DEAL

Another business that started life as part of Living Ventures is New World Trading Company (NWTC). The Botanist owner, which was created by Bacon and Roberts in 2011, attracted a £2.7m investment from LDC and Hill Capital Partners in 2013. LDC then exited NWTC in a £50m sale to fellow private equity firm Graphite Capital in June 2016, with Living Ventures exiting at the same time.

Living Ventures is also behind the Manchester House, Australasia, Grand Pacific and Artisan brands.

Roberts said: "Living Ventures is a business that tends to flex in size. We've developed a model that tends to grow businesses from inception right through to exit. So for example New World Trading Company was subject to a management buyout last year led by Chris Hill [chief executive of New World Trading Company]. Chris worked with us for many years.

"We'll create a concept which we'll develop and test and then we'll open a second site not too far away. Once we've got to that stage we might look to bring in external investment and look to identify a manager to run that business."

"They [the managers] get the advantage of working within a strong company with a strong direction. And we get the passion and drive that comes from the management to build and grow the business.

"That's a model that developed by accident after our Living Room experience."

Roberts, who was formerly Living Ventures' group commercial director, became group chief executive in November 2015 with Bacon stepping up to executive chairman at the same time. Bacon, one of the UK's most high-profile restaurants, died from cancer in April 2016 at the age of 52. To date, the Tim Bacon Foundation set up in his memory has raised £573,000 for charity.

It is now 18 months since Bacon passed away. Roberts, however, is determined to ensure that his legacy lives on.

Roberts said: "Although Tim's passing was huge for me at a personal level and for the business, it wasn't the catastrophe for Living Ventures that people from the outside might have thought.

"Since Tim died, we've achieved the largest exit [NWTC] in our company's history which was a huge achievement. We're also back up to 42 sites which is where we were before the New World Trading Company exit.

"And we've launched a new concept in Grand Pacific, The Alchemist has doubled in size and Gusto's the largest business we've ever had under the Living Ventures banner.

"I think Tim would be immensely proud of these achievements, I know he would be."

Tags: Blackhouse, Living Ventures, Steak
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