The restaurant market sector in the UK currently is unrecognisable from the impact of Covid-19. Household names have joined countless lesser known eateries being no longer in business.
Making trading even more difficult, yesterday’s announcement from government set even more stringent rules in place limiting people meeting more than five others at any time, and warnings to the hospitality industry to follow all guidelines or face fines for not doing so.
Amongst these conditions, and others, attempting to launch on the London Stock Exchange and seek investment to grow a restaurant group would seem ambitious. Various Eateries, who own, develop and operate restaurant sites in the UK has today announced its intention do just that.
Various Eateries is planning to trade on AIM starting the end of September/early October 2020. The Alternative Investment Market (AIM) is a sub-market of the London Stock Exchange that is designed to help smaller companies access capital from the public market. Various Eateries intends to raise up to £25 million by way of a placing of its Ordinary Shares on Admission.
The team leading the move have an impressive track record having created some of the UK’s largest and most respected hospitality groups. Between them, they have opened more than 400 new sites and have generated attractive returns for investors since the mid-1990s.
Various Eateries Leadership Team
- Hugh Osmond, Founder – PizzaExpress, My Kinda Town, Punch Group.
- Andy Bassadone, Chairman – My Kinda Town, Strada, Côte Restaurants, Bill’s, The Ivy Collection.
- Yishay Malkov, CEO – The Ivy Collection, Gordon Ramsay Holdings, Roka Zuma, Park Chinois.
- Oli Williams, CFO – itsu, McDonald’s.
- Matt Fanthorpe, Chef Director – Guy Savoy, Jamie’s Italian.
Hugh Osmond, Founder of Various Eateries, commented: “I believe that Covid-19 is the biggest event to hit the UK economy outside of war-time. Whilst I deplore the terrible effect it has had on our industry, we are confident that there will be major opportunities for a well-funded group with strong management to build a fantastic business in the aftermath of Covid.
“We are also confident that we have one of the most experienced teams ever assembled in the hospitality sector, 2020s-appropriate brands, and an established platform business and I am firmly of the view that the opportunity is as big as it was in the early 1990s when I jointly led the acquisition of PizzaExpress.
“The funds raised will be principally used to take advantage of the opportunities and accelerate growth. Our senior team has an established track record of acquiring, converting and opening sites and, with, what we perceive to be, the availability of premium sites at attractive rents, I believe the prospects for Coppa Club and Tavolino are exciting.
“There are also a number of well-known brands out there that are struggling to navigate the pandemic and various other industry pressures. Should the right opportunities present themselves, we would consider supplementing our organic growth through acquisition, offering distressed brands a more sustainable future as part of the Group.
“The brands we operate have been designed to cater to changing consumer preferences. Coppa Club provides all-day flexible spaces ideal for remote working as well as extensive outdoor spaces, and separate bar, lounge and restaurant areas. Tavolino is a modern all-day Italian bistro with potential for every high street. With a team that between them have created some of the UK’s most well-known sit-down restaurant groups over a period of 27 years, we believe we are ideally placed to make the most of the post-lockdown landscape.”
Andy Bassadone has 25 years’ experience in the UK restaurant sector. He founded the Italian-themed restaurant chain, Strada, in 1999, working with partner Chris Benians to grow the company to 25 restaurants over a 5-year period before selling the company for £56m in 2005.
After sale, Andy remained at Strada as CEO, and grew the restaurant group to 55 sites, ultimately overseeing its disposal a second time for £140m in 2007. As set out above, Andy went on to launch two other successful restaurant concepts including market leading French Bistro chain Côte in 2007. This was sold by Andy Bassadone and his team for £100m in 2013 and in 2015 it was sold again for £240m. He later headed up the expansion of Bill’s Restaurants and, more recently, The Ivy Collection.
Hugh Osmond is one of the industry’s most well-known and successful entrepreneurs. He led the acquisition and transformation of Pizza Express from annual losses in 1993, to £38m of EBITDA by 2001, growing the group to 367 restaurants, serving 16 million diners per annum. Hugh also led the acquisition and sale of My Kinda Town, the international restaurant group, with Andy Bassadone. In 1997, Hugh co-founded Punch Taverns and became the Executive Chairman of Punch Group. He led the process of consolidation in the pub industry to create a group with over 8,000 outlets, and an enterprise value of £3.5 billion in 2005.
Yishay Malkov, CEO, was Executive Operations Director of the Ivy Collection and helped develop the concept, opening c.30 sites in four years. He was also restaurant director at Gordon Ramsay Holdings and Managing Director of Park Chinois.
Oli Williams, CFO, was previously Group Financial Controller of itsu and Senior Franchise Accountant at McDonald’s.
Matt Fanthorpe, Chef Director (non-board position) who was Chef director at Jamie’s Italian opening 34 restaurants in 6 years, and who worked under three star Michelin Chef, Guy Savoy.
The Group currently operate two contemporary brands across ten locations – Coppa Club, an all-day clubhouse offer in prime locations throughout London and the South-East and Tavolino, a new Italian brand with nationwide potential, offering high quality Italian food at mid-market prices. The Directors believe that the two brands are well positioned for the new market conditions post-lockdown.
The Group also operates two Strada sites which, subject to matters including market conditions, it aims to re-fit as Tavolino sites.
Without doubt the leadership and management team credentials are robust, you could even label them restaurant superheroes. But launching and growing new casual dining brands in the current UK restaurant market is a challenge of Herculean proportions.
Is the UK ready for new restaurant chains
The first task would seem to be the physical environment they operate in. With no end in sight or forecasted date for a post Covid-19 world, a new brand would surely require new restaurant site design. This has already been undertaken by Burger King and a video of the designs here, show how minimising multiple touch points is the focus.
Many restaurant estates in whole and in part have been sold under distressed circumstances in 2020, Boparan for example picked up substantial parts of Carluccio’s at a fraction of what was paid ten years earlier when the group looked in good shape. So acquiring restaurant sites should continue to be possible at low cost and as such an advantage to Various Eateries.
There is also, unfortunately, a huge bank of highly experienced and talented restaurant staff, both front and back of house, available for work. This would allow Various Eateries to select and hire teams of very capable people, an enormous advantage in many ways.
The success would of course be wholly dependant upon sufficient volumes of consumers returning to casual dining. Consumer confidence is at an all time low, safe hospitality would need to be at the forefront of consumer marketing to aid any return. The design of the new eateries, coupled with capable, experienced people operating in brands seen to be operating safe hospitality would be well received.
In a statement from Various Eateries, Coppa Club is cited in particular as being ‘designed specifically to take advantage of changes in consumer behaviour which have now been accelerated by Covid’.
The Directors of Various Eateries believe that the Group is well placed to provide guests with a safe environment, given its sites with large outside seating which makes the implementation of social distancing possible, without eroding the customer experience.
The proposition is intriguing, without doubt the team at the helm would seem to be one to back, the market conditions however present a task we have already labelled as Herculean. An investment opportunity not for the feint hearted.
We wish Various Eateries every success and look forward to reporting on it.
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