Oakman buys seven pubs from investment partner that helped it escape “dysfunctional” banking arrangement

Peter Borg-Neal, CEO

Pub group Oakman Inns today announced it has completed the acquisition of seven freehold public houses with combined EBITDA of £2.8m from funds managed by Downing LLP.

The transaction was completed in three tranches with the purchase of two companies Downoak Ltd (The Akeman, Tring, The Akeman Inn, Kingswood; The Crown & Thistle, Abingdon) and Hedderwick Ltd (Banyers House, Royston; The Cherry Tree, Olney) as well as The Globe in Warwick, which was previously held in a partnership.

Following last year’s purchase of Ei Group’s share of Hunky Dory Pubs Ltd, the deal continues Oakman’s key strategic initiative of uniting all of its trading activities within the parent business.

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Peter Borg-Neal, CEO and founder of Oakman Inns, said: “Oakman Inns and Downing LLP have worked together since Steven Kenee and myself shook hands on our first deal in 2014. At that point, Oakman had seven pubs and a great trading record with sales of over £10m, but faced huge issues with a dysfunctional banking relationship and a shortage of growth capital. Five years later, we have just opened our 23rd pub, last year achieved sales of £38m and were recently named by Alix Partners as the fastest growing pub company in the UK.”

Mr Borg-Neal said that over those five years, its relationship with Downing was instrumental in our success.

In 2014, Downoak Ltd was created, a vehicle that developed the Akeman Inn in Kingswood before acquiring three of its freeholds, enabling the company to break free from its “unhelpful” banking arrangement.

“Downoak has gone from strength to strength with those four pubs enjoying sales of nearly £7m per year in 2018/19,” continued Mr Borg-Neal. “Oakman and Downing also became partners in The Globe, Warwick and Hedderwick Ltd in 2016. Hedderwick acquired sites in Olney and Royston which it developed into the very successful Cherry Tree and Banyers House respectively.”

In 2016, The Royal Foresters in Ascot came on to the market. “Knowing it to be one of the best sites in the UK, I was determined to acquire it and it was Downing who we turned to for the initial funding. The deal was done utilising a bridging loan before we refinanced it with the UK’s first pub-backed Crowd Funded Innovative ISA. This was a huge success, raising the £2.5m target in under 24 hours.”

Downing also provided bridging facilities when the opportunity to buy the freehold of The White Hart, Ampthill came up and, in 2017, invested £4.7m into Apprise Ltd, a new pub company for which Oakman Inns provides operational and managerial support.

Oakman’s revenues for the year to 31 March increased 6% on a like-for-like basis to £37.7m.

Since the year end, Oakman has reopened the refurbished and enlarged Beech House in Beaconsfield and opened The Polecat Inn, Prestwood. It has three sites awaiting development – in Wokingham, Farnham and Buckingham – and has agreed deals on a further two sites.

Tags : investmentOakman InnsPubs
Andrew Seymour

The author Andrew Seymour

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