Peach Pubs has called off its sales process after two prospective deals fell through at the 11th hour, MCA understands.

The group has decided not to pursue a full exit but is seeking an investor to come on board from the summer to inject between £1m and £3m to fund the next stage of growth. Options on the table include bank finance, investment from suppliers, private individuals or private wealth fund.

As MCA previously revealed, The Restaurant Group walked away from a deal to acquire the Midlands-based multiple operator in November, to focus on its acquisition of Wagamama.

At the start of this year, it is understood that an approach from Brasserie Bar Co also broke down.

Taking into account the two aborted negotiations, the 19-strong Peach is thought to have spent £400,000 on fees.

The management has now decided to pursue a strategy referred to as Peach Forever, which will start with meetings with suppliers next month to re-negotiate terms ahead of a search for trade or private investors to support the next stage of growth from June.

The group is also set to kick off the search for a new finance director, with Julie Centracchio having joined Boston Tea Party last month.

Peach managing director, Hamish Stoddart, said: “For the last eight months, we have been pursuing a major investor in Peach and the realisation of most or all of our shareholders’ original investment. A deal that held promise fell through at the eleventh hour when the buyer could not secure the funds to purchase Peach at the price agreed.

“Uncertainty may also have played a part; uncertainty because of Brexit, which caused our sales to fluctuate to the extent that we were down in October and November and then gained it all back over Christmas. We start 2019 though, as we have for the last 17 years so far, as a profitable business, with a healthy balance sheet and four valuable freeholds supporting our bank funding.

“Our pubs continue to perform well, with many delivering really strong like-for-like growth. Our top ten average 6% like-for-like growth and overall we are running at about 2.5%. We are generating £5m pub EBITDA, so averaging over £250k a pub.

“One very big advantage we have is that our pubs are in market towns and villages and not in large city centres. Most of them are destination pubs with loyal guests happy to return time and time again because of the great product and service experience the Peach team provides. We’re proud of that and also of our team, who we’ve always said is our biggest asset.”

He added: “External pressures, from rents, rates, tax, inflation and minimum wage, plus salaries of chefs and GMs have all risen to we can’t sit still. So we have decided to focus on what makes us profitable, following eight months of focussing on a transaction, agree short and long-term goals and re-group. We’ll be looking at food, new development of dishes and the way we serve, our drinks list, our wines and our hospitality, and will work towards increased profitability. We are looking forward to the challenge.”

He concluded: “We will find a way to make Peach even better and to make life Peachy.”