Jones to explore Ultimate growth
by The PMA Team
Newcastle-based nightclub company Ultimate Leisure looks set to go on an expansion drive after its existing management team was ousted in a shareholder revolt last week.
Former Yates chief executive Mark Jones has become executive chairman at Ultimate with Colin Rowlinson, who worked with him at Yates, becoming business development director. Industry insiders expect Jones and Rowlinson to explore expansion opportunities outside its north-east heartland in the coming weeks.
Dawnay Day, the property and financial services group, headed the revolt which saw founder and chairman Allan Rankin leave the company. Ultimate chief executive Bob Senior, development director Tim Wynn, operation director Alison Elliott and non-executive director Keith Atkinson also stepped down.
It is understood the departing management were unwilling to deviate from the existing 'safety-first strategy. They believe the company should avoid expanding at the moment because the new licensing regime is creating too much uncertainty and there is a lack of investment opportunities.
The arrival of Jones at Ultimate follows months of unrest among institutional shareholders. In April, they expressed anger that Allan Rankin's brothers and co-founders, Stephen and John Rankin, had sold large number of shares prior to a profit warning.
Both Stephen and John Rankin reduced their holding in the company below 3% just a month before the profit warning. A second profit warning followed in July with Allan Rankin selling 1.35 million shares on the day of the warning and the following two days.
Ultimate was founded in 1997 and floated on the AIM in 1999 it now runs 30 sites. It is estimated that the Rankin brothers made a profit of around £22m on their original combined investment of £5m in Ultimate.
A source close to the departing management team told the Morning Advertiser: 'There is a lot of private-equity money around and a lack of strong management teams, so they will be looking at other opportunities. It is understood that the team plans to work with Belfast restaurateur Eddie Fung on new projects.
Jones led the £155m GI Partners buy out of Yates last year before selling the company to Robert Tchenguiz for £202m in May this year.
