City investors have expressed concern at share sales by the founders of Inventive Leisure, owner of the Revolution chain of vodka bars, and their backers that will bring them millions as the company raises more money to fund its expansion.

Inventive's chief executive, Roy Ellis, its finance director, Neil Mcleod, and two big shareholders, John McDonald and Ian Macleod, have announced that they will be selling stock worth £4.2m, leaving them with around 40% of the company's shares, down from 58%.

Ellis told the City that the four deserve to cash in £1m apiece, for founding and running the company for the past 10 years or so. However, one observer said: "It's bound to set alarm bells ringing among investors, even more so given the recent fall from grace of Winchester Entertainment in February after chief executive Gary Smith sold £592,000 of shares two weeks before a profit warning."

Inventive revealed that turnover for the six months to December 2001 rose 44% to £12.4m, helped by six new bars opened during the period. Underlying like-for-like sales were up only 1.2%, hurt by sales at its bar in Leicester slumping 20%.

The company said the Leicester bar had suffered at the hands of competitors but sales are now back on track with an improving performance. Organic sales growth in the 27 weeks to February was 2.9%. New outlets help push pre-tax profit up by 42% to £1.32m, while fully diluted earnings rose 51% to 4.6p per share.

The group has expanded the estate portfolio by 21%, increasing the number of outlets to 35 by the end of the period. Inventive is to raise £5.6m through a placing and open offer of new shares, net of expenses. The new funds will be initially used to pay down much of the £11.4m of net debt in the balance sheet, taking gearing down from the current 148% to 45%. However, when the time is right the extra funds will be used to provide additional working capital and to expand the number of Revolution bars with an accelerated roll out programme.

Inventive says there is room for Revolution bars in around 100 towns and cities throughout the UK. It expects to open 10 to 12 outlets a year, and over the next few months it will open new bars in Northampton, Clapham, Bradford and Lancaster.