Novus Leisure sold to LGV Capital and Hutton Collins for £100m

The move is set to see Novus continue its expansion in London and further afield, with the group given access to tens of millions of pounds of growth funding to strengthen its existing footprint and double profitability. The deal will also consolidate and strengthen the group's market leading position in the premium bar London market.

LGV and Hutton Collins said they have backed the existing management team led by chief executive Steve Richards, effectively ending speculation linking him with the vacant CEO position at Mitchells & Butlers. John Kelly will remain as non-executive chairman.

LGV Capital and Hutton Collins will take joint ownership of the highly-regarded operator. The statement said that the deal has “provided a value exit” for the incumbent majority shareholders Barclays Ventures and RBS Strategic Investment Group.

The statement said: “LGV and Hutton Collins will support the group’s future strategy to double its central London portfolio over the next three years.

“Looking further forward Novus also has the potential to expand outside its London core to cities such as Manchester, Bristol and Leeds.”

Richards said: “Novus has a resilient model that has served it well over the years. Our focus and investment in our pre-booked system has given us the ability to take market share and deliver predictable high quality earnings.

“These attributes have resulted in keen interest by the private equity community to invest in the next stage of Novus’ development and in LGV and Hutton Collins we have secured investors who have an enviable record of backing successful businesses in the leisure sector. We really look forward to working with them over the next few years and to maximise the growth potential of Novus Leisure.”

Bill Priestley, a managing director at LGV Capital, said: “We are delighted to have completed this acquisition. Novus has one of the best collection of bars and venues in the UK, which, together with its website, www.latenightlondon.co.uk has enabled it to outperform its market and peer group for some years.

“We are backing a first class management team, led by Steve Richards, and look forward to developing the business by growing the estate through acquisitions.”

“This will be LGV’s fifth investment in the pubs and bars sector. We backed the original start up of Enterprise Inns before it floated in 1995, co-funded the acquisition of the Unique Pubco, which was sold to Enterprise Inns in 2004, backed the 2008 management buy-out of the Liberation Group, the Channel Islands’ leading pub company and brewer and acquired Amber Taverns, the northern community pub specialist in 2010.”

Graham Hutton of Hutton Collins said: “Although Hutton Collins has not invested in this specific sector before, we have a depth of knowledge in the closely related dining sector, having previously made successful investments in Pizza Express and Loch Fyne, and having significant continuing investments in Caffè Nero and Wagamama.

“When investing we look for a differentiated product, strong growth prospects and a high performing management team, Novus ticks all those boxes and we’re looking forward to helping the company to grow.”

Rothschild advised Novus, Barclays Ventures and RBS Strategic Investment Group. Deloitte advised LGV. Zolfo Cooper advised Hutton Collins.