Nightcap has raised £10m through a share placing in order to further its investment strategy and to roll out its recent acquisition – Adventure Bar Group (ABG).

Nightcap, which also acquired the 10-strong London Cocktail Club in January 2021, has said it believes ABG has the potential to expand nationwide, in up to 40 locations.

The hospitality group, led by Sarah Willingham and Michael Toxvaerd, which announced the deal to acquire ABG earlier this month, had originally intended to raise proceeds of approximately £4m, but strong demand from existing shareholders and several new institutions saw this amount significantly oversubscribed.

It is raising the funds through two tranches – placing a nearly 43.5m new ordinary shares, with Allenby Capital acting as sole broker. Nightcap is looking to fund the roll out of ABG’s Tonight Josephine, Luna Springs and Bar Elba brands.

ABC recently opened its first site outside London – a large outdoor bar, food and entertainment venue called Luna Springs, in Digbeth, Birmingham. It will also open a second venue in Birmingham, Tonight Josephine, on 17 May.

The group will also use the funds to partially repay debt which Nightcap will assume as part of the acquisition of ABG and also make further progress with its strategy to identify and acquire other drinks-led hospitality groups.

Chief executive of Nightcap, Sarah Willingham, said: “We are really pleased to see such strong demand in support of the Nightcap strategy. The success of our fundraise from both existing shareholders and several new institutional shareholders shows just how much support there is for hospitality in the UK and specifically for our strategy of acquiring and growing drinks-led businesses in the sector.

“We believe it is the right time to have equity to invest on the back of the damage caused by multiple lock-downs in the last year. With the completion of our second acquisition and this substantial equity raise, Nightcap remain well capitalised to execute on its strategy by finding more likeminded businesses and people to join our journey to become a leading bar group in the UK.”