The company, which owns the Dirty Martini chain, said it was ‘disappointed’ to have ended its merger talks with Revolution Bars
Nightcap has officially backed out of a potential rescue deal for its struggling competitor, Revolution Bars.
Nightcap expressed “disappointment” after its merger proposal was turned down by the larger hospitality chain earlier this week. On Tuesday, Revolution Bars, which operates Revolucion de Cuba and Peach Pubs brands, dismissed the offer, stating it was “incapable of being delivered”.
This development follows Revolution’s announcement last month of a sale process and major restructuring efforts to remain solvent. The restructuring includes raising £12.5million and shutting down 18 venues. Revolution clarified on Tuesday that Nightcap’s earlier non-binding proposal did not account for the proposed fundraising, necessitating two separate funding rounds from Nightcap.
On Thursday, Nightcap countered, stating its proposal did not specify a fixed fundraising amount and that it never received legal advice indicating the proposal couldn’t be executed. Nightcap, which owns 46 UK bars including the Cocktail Club and Dirty Martini chains, suggested replacing the planned £12.5million fundraising with a merger of the two listed companies.
It also proposed additional fundraising and implementing other aspects of Revolution’s restructuring strategy. Furthermore, Nightcap intended to sell off Revolution’s Peach Pubs business. The business, led by Sarah Willingham, has stated its intention to continue exploring acquisition opportunities within the hospitality sector.
Nightcap commented: “The board also believes that opportunities for further consolidation in the late night sector will continue to arise in the coming year as the sector moves from incremental M&A (merger and acquisition) activity to a fundamental structural transformation as many of the operators in the sector are going through significant change.”
