James Horler, the former chief executive of La Tasca, is to lead a management buy-in of Ego, a Mediterranean restaurant concept, backed by LDC, the private equity arm of Lloyds TSB.
Horler is joined by a number of individuals from La Tasca Group, which was last year sold to Laurel Pub Company for £124m, including John Barnes and Ian Edward, who will act as non-executive directors.
LDC is supplying £9.1m of equity and loan stock in return for a 58% stake. The money will fund the acquisition of the fledgling chain from its founders, Jason Ellison and Jonathan Poole, and the rollout of a further 38 outlets over the next four years.
It is the first time Horler has worked with LDC but the lead partner at the private equity firm is Craig Armour, who recently switched from penta Capital – the group that backed the purchase of La Tasca in 2001.
Horler, who becomes executive chairman, and five colleagues will take a combined 42% stake by investing some of the proceeds from the La Tasca sale.
Horler, who before La Tasca ran the Frankie & Benny’s chain for The Restaurant Group, said that Ego would initially focus on suburban areas in the North and the Midlands, including Nottingham and Leeds.
He said: “There is a lack of quality casual dining table-service restaurants in suburban locations. There are places that the big national brands haven’t got to yet and probably won’t get to.”
Ego, which has an average spend per head of £19, was aimed at the over-40s “who don’t want to have to go into the city centre to find a decent restaurant.”
It has five outlets in the North West – in Bramhall, Chester, Heswall, Liverpool and Stockton Heath – and will soon open its first Midlands site in Lichfield.
Horler said that once the group reached 10 sites it would seek to raise debt funding, and that he was confident the business would be able to ride out a fall in consumer spending, arguing that restaurants were “a reasonably safe bet”.
Cedar Dean handled the deal on behalf of James Horler and LDC.
