LGV acquires Amber Taverns
LGV Capital (“LGV”) has successfully completed the management buy-out of Amber Taverns Limited.
Amber Taverns is a community based pub company, based in Preston, Lancashire. It owns and operates 56 pubs, predominantly in the North West and North East under its unique Operator Agreements, which incentivise its pub operators by offering them a share of the pub’s takings.
LGV has backed the existing management team of Clive Preston (Chairman), James Baer (Joint MD), Bryan Wardman (Joint MD), Michael Norris (Finance Director) and Gary Roberts (Operations Director).
LGV is a well established provider of private equity in the UK market and part of the Legal & General Group. LGV has a 20 year history of successfully backing management teams in consumer, leisure, services and healthcare sectors.
Commenting on the investment, Bill Priestley, a Managing Director at LGV, said "We are delighted to have completed the acquisition of Amber Taverns. The death of community pubs has been significantly over exaggerated in recent years and Amber is a perfect example of a business which has quietly gone about disproving the rule that pubs can only succeed where there is a food offering. From a start up in 2005, Amber has selectively expanded its estate and can now offer some of the best local pubs in the North. We, together with Amber’s long term funders, Lloyds Banking Group, look forward to supporting the management team to expand the estate further over the next few years.
“This will be LGV’s fourth investment in the pub sector. We backed the original start up of Enterprise Inns before it floated in 1995, co-funded the acquisition of The Unique Pubco, which was sold to Enterprise Inns in 2004 and, most recently in 2008, we backed the management buy-out of The Liberation Group, the Channel Islands’ leading pub company and brewer. In each of these, we were attracted by the quality of the pubs and the strength of the management teams we were backing and Amber is no exception.”
Amber Taverns’ Chairman Clive Preston said: “The board of Amber Taverns Limited is pleased to announce the purchase of the entire issued share capital of Amber Taverns by LGV Capital and the Company's management team. This is an excellent result for all parties.
“For our original VCT backers Unicorn Asset Management, Acuity Capital Management and MaxCap Partners who have supported us for the last five years it provides a successful cash exit of 2.7 times their original investment and gives LGV, who already have a sound knowledge of our industry, a well established platform in the UK mainland licensed sector.
“Our management have taken a financial stake in the acquiring vehicle and are aiming to make it one of the fastest growing pub owner/operators in the UK. The team has the ability to double the size of the business in the next three to four years with the help and support of LGV.
“Our policy of purchasing carefully selected distressed or closed pubs in busy locations in the North of England and then making a significant investment in refurbishing them has been hugely successful. We add further value by featuring key sporting events on big screen TVs, and by selling premier brands at realistic prices.
“We have developed a unique operating model which empowers pub managers to be entrepreneurs, highly incentivises them by giving them a percentage of their sales and encourages them to be a genuine host.
“Our Operator Agreement is already being used by other substantial pub companies and we believe it will gain increasing popularity in the industry in future years. Large managed houses will continue to work well on payroll but we believe our hybrid approach is the way forward for much of the pub stock in this country.
“Since our inception in 2005 we have built from scratch an estate of 56 pubs across the North of England. Despite the recession and general gloom surrounding the sector we have proved that the local wet led pub still has a great future as the home of responsible drinking in the community.
“LGV had the vision to see and grasp this opportunity and with their support we are going to do what we do best - open more great pubs for the local community to enjoy."
