Hutton Collins and LGV back Novus Leisure MBO

Sonnie Ehrendal
27 July 2012

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Hutton Collins and LGV Capital have backed the management buyout of bar and club operator Novus Leisure, which notably runs the Tiger Tiger brand.

The deal was valued at £100m. Current CEO Steve Richards and non-executive chairman John Kelly will remain in their positions.

The investors intend to support Novus's plans to double its central London portfolio over the next three years and will look to expand in other cities, including Manchester, Bristol and Leeds, in the medium term.

Previous funding
Motion Equity Partners (formerly Cognetas) acquired Novus (then known as Urbium) in a £155m deal in October 2005. The deal was supported by senior debt from the Royal Bank of Scotland and mezzanine funding from Barclays Ventures.

In mid-2009, Barclays and the Royal Bank of Scotland acquired a majority shareholding in Novus through a debt-for-equity swap.

Prior to the current transaction, Barclays held a 47.87% stake in the company through various vehicles, while the Royal Bank of Scotland held a 25.59% stake through holding company West Register Investments.

Company
Novus, founded in 1999, operates a number of bars and clubs in the UK. It targets young, affluent customers through brands like Tiger Tiger and Balls Brothers. Headquartered in London, it employs 1,800 staff and reports an operating profit of £1.7m from a turnover of £107m.

People
Founding partner Graham Hutton worked on the deal for Hutton Collins. Managing director Bill Priestley represented LGV. Steve Richards is CEO of Novus.

Advisers
Equity (Hutton Collins) – Zolfo Cooper (Corporate finance).
Equity (LGV Capital) – Deloitte (Corporate finance).
Management – NM Rothschild (Corporate finance).