Revolution Bars Group has announced that its talks with the Deltic Group have been terminated.

The board was forced to reveal the discussions about a possible acquisition last month after press speculation.

However, it issued a statement this evening saying that after a period of engagement and due diligence, the board had concluded that a transaction with Deltic would not be in the best interests of the Company’s shareholders.

The company said it would continue to focus on “delivering the positively received strategy outlined in its preliminary results announcement made on 2 October”.

Responding Deltic said: ”It was disappointing that such talks, that were only ever at an early stage, were leaked and that the decision not to proceed comes as little surprise.

“Deltic still believes that there is a compelling financial case for a merger between the two companies but respects the decision of the Board of Revolution. Deltic remains a shareholder in Revolution Bars Group plc and will follow developments closely.

“The board would also like to reiterate that Deltic is a well-run business with a strong financial performance over many years. The Revolution merger proposal was only one of several routes that the Deltic directors were exploring in order to take the company forward. It continues to believe the late night economy is a good investment and the doubling of profits over the last six years, with approximately the same number of venues, underpins that view.

”Deltic will continue to seek profitable growth both through continued investment in the current business and through a number of possible strategic acquisitions.”

Last October, Deltic proposed a merger with Revolution, which would see the former own 35% of the enlarged group, with the rest owned by Revolution’s shareholders.

The proposal was rejected by Revolution’s board, which favoured a deal with Stonegate Pub Company.

However, later that month Revolution’s shareholders voted against Stonegate’s £101.5m bid for the company.

Both sides were restricted from re-entering talks with Revolution for six months.

In November the Peter Marks-led Deltic announced the purchase of 1,500,000 shares in Revolution Bars, amounting to a 3% stake in the company.

Setting out his strategy in Revolution’s full-year results announcement last week, chief executive Rob Pitcher said he had already refreshed the company’s digital and social media strategy, was looking to further develop relationships with delivery partners and aiming to develop a click and collect offer. The sales team has been strengthened and the group is working with a consultancy to further refine the Revolution brand proposition.

He has also launched a review of pricing, refreshed the food offer – including introducing a weekend brunch offer in Revolucion de Cuba – and launched new cocktails. Pitcher said a key task was to re-establish the group’s “market-leading position for Friday and Saturday night entertainment”.