Heartwood Collection secures £100m funding for ‘ambitious’ growth plans

As part of this, the group has also laid out plans to provide almost 500 boutique bedrooms in the same time frame.

These ambitions will create a further 1,500 jobs and down the nation and take the total number of employees to 2,700.

The funding includes a new banking facility of £50m from OakNorth Bank while funds advised by Alchemy Partners have committed £50m to date with the private equity firm also supporting Heartwood’s rollout with an expected further £50m investment to help the pub group’s expansion plans.

Heartwood has completed the acquisition of 11 freehold sites​ over the past 12 months and is close to completing a further five this summer​.

New funding plans

Managing director Richard Ferrier said: “This additional support from OakNorth and Alchemy is testament to the strength of the business the team at Heartwood is building.

“It will enable us to build on our success to date as we focus on growing the Heartwood Collection into the UK’s leading premium pubs and pubs-with-rooms business.”

The business recently rebranded​, marking its journey to its target in becoming a freehold pub company, underscored by a premium brasserie division.

Heartwood Collection chairman Mark Derry said: “This new funding will be deployed for acquiring additional freehold sites and it will underpin our target of reaching more than 60 sites and 500 rooms over the next four years.

“While ambitious, we are confident our combination of highly skilled chefs, warm hospitality and character-filled pubs leaves us ideally placed within a market, which is considerable underserved.”

The multi-site business is one of OakNorth’s longest-standing clients according to the bank’s head of debt finance Ben Barbanel, who described Mark Derry and the team as “a great example of the excellent entrepreneurs we have in the UK.

Equity investment

He added: “The Heartwood Inns and Brasserie Black brands are some of the finest the UK hospitality sector has to offer.

“Despite ongoing economic challenges, the business is set for future growth, which is a testament to Heartwood’s leadership and the brilliant team that has been built.

“Working alongside the hugely talented team at Alchemy Partners was once again very enjoyable and we hope to complete many more transactions with them in the future.”

Alchemy Partners partner Thomas Boszko labelled Heartwood Inns as the “best food pubs out there”.

“The pubs provide an offer that guests love. I’d like there to be a lot more of them and I’d like them to all be freehold,” he said.

“OakNorth has been a superb partner to Alchemy many times before and I am pleased to be working with them again.

“Their support, combined with Alchemy’s continued equity investment, provides new funding, which will help fuel our ambitious growth plans.”