Revolution Bars Group, the listed operator of the Revolution and Revolución de Cuba brands, this morning announced it is in discussions regarding the acquisition of four bars in Edinburgh, in a deal value at £16m.
The company said the acquisition would introduce a further brand, which it believes to be capable of being rolled out to other sites.
MCA believes that the company is in talks with the Montpeliers of Edinburgh in regards to four of its sites. Montpeliers’ estate includes its eponymous all-day dining site; burger and cocktail bar format Candy; the Indigo Yard; and its flagship boutique hotel, bar and restaurant, Tigerlilly.
Montpeliers, which is led by founder David Wither, also operates late-night venues The Opal Lounge and Lulu; plus boutique hotel & bar Rick’s.
In the financial year ended 26 April 2015, Revolution said that the four bars it is proposing to acquire reported an aggregate site EBITDA of £3.3m. The proposed acquisition, should it complete, is expected to be significantly earnings enhancing for the group’s financial year ending 30 June 2017.
The acquisition is expected to be funded via new debt, a relatively small placing of new ordinary shares for cash and the issue of ordinary shares to the vendors.
The company said that discussions were ongoing and, particularly in light of the results of the EU Referendum announced this morning, may or may not result in any transaction, whether as described above or at all, being agreed.
At the same time, Revolution said it continued to trade well in the second half of the financial year ending 30 June 2016 following its strong performance in the first half.
It said that the group’s site opening programme for the financial year ending 30 June 2017 was progressing ahead of schedule.
Earlier this week, Revolution opened its ninth Revolución de Cuba site in Liverpool following a £1.7m investment. A tenth site is due to open in Reading in October. It is also in talks to open a £1.4m Revolución de Cuba site with retractable roof in Newcastle city centre.