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Revolution Bars Group buys Peach Pub Company and eyes up UK expansion

Revolution-Leadenhall

Revolution Bars Group has bought The Peach Pub Company’s 21-strong pub estate for a sum of £16.5m to accelerate and diversify its growth strategy across the UK.

The acquisition has been made on a debt and cash free basis, of which £0.5m of the deal is contingent upon the future performance of the business.

The combination of the two companies aims to create a more balanced and diversified business with scale and compelling growth potential across multiple trading segments of drinks, food and accommodation.

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Revolution Bars, which operates nationwide with brands including Revolution Bars and Revolucion de Cuba, currently runs 69 pubs across the country.

Peach operates 21 leasehold pubs in the South of England and the Midlands that deliver attractive financial metrics, with average weekly takings (net of VAT) approaching £30,000, a food mix of 53% of sales, and strong profit and cash conversion.

The group’s offer is aimed at affluent guests seeking a consistent, premium food-led pub experience.

Peach pubs are located outside of city or larger town centres and have benefited from “working from home” market dynamics.

Operating premium pubs will present further growth opportunities for Revolution in the leasehold food-led pub market, either individual sites or in small groups, while it continues to expand its Revolution and Revolucion de Cuba brands.

The Revolution Bars management team has extensive experience of both food-led pubs and premium bars, and the entire operations team of Peach, led by Chris Stagg, will remain with Peach following the acquisition.

Current finance director Tony Bobath will assist in the integration of the two businesses.

Trading in Peach’s current financial period, since 3 January 2022, has been strong with like-for-like sales up by more than 10% compared to 2019.

The board anticipates 12-month site EBITDA for Peach in Revolution’s current financial year to be over £5m, with central costs in the region of £3.5m on turnover over £30m.

Revolution’s net cash position prior to the acquisition and strong trading performance following the pandemic, together with the compelling strategic rationale for the acquisition of Peach, has allowed it to fund the entire consideration for the transaction from its own banking facilities.

Rob Pitcher, CEO at Revolution Bars Group, said: “This is an exciting and transformative opportunity for Revolution. It broadens our guest base, balances our day part sales and seasonality whilst providing another avenue for growth both organically and by acquisition. Peach is a quality business with great pubs offering a premium experience. It has rebounded strongly from the dark days of the pandemic. Central to this success has been a strong people focused culture with clear values that are focused on making the right choices for guests and our teams, a very similar approach to that taken at Revolution.

“We welcome the Peach team to Revolution, where they can continue their excellent work delighting guests and seek continued personal development in a business with a multi-pronged strategy that has similar values, ambition, and drive for excellence which Peach has clearly displayed over the last 20 years.”

Hamish Stoddart, co-founder and managing director of Peach Pubs, said: “Twenty years ago, we opened the Rose & Crown in Warwick, believing that every market town deserves a great Gastropub, serving a fine steak and a delicious glass of wine offered with true hospitality. We have grown from 1 pub to 21 profitably for two decades.

“Today, we have announced the sale of Peach Pubs to the Revolution Bars for a consideration of £16.5m – this comes from an initial £140k investment and the returns include a large share to our executive and loyal key team, who have shared the unforgettable ride.”

Revolution Bars was advised on the sale by Sapient Corporate Finance, while Peach Pub Company was advised by finnCap Cavendish.

Revolution Bars Group continues expansion with refurbishments and new locations

Tags : Revolution Bars GroupThe Peach Pub Company
Joshua Walton

The author Joshua Walton

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