A year of deals ahead for restaurants?

Just one working week into the New Year and we already have a potential candidate for Deal of the Year at the 2006 Retailers’ Retailer Awards. La Tasca, the tapas bar chain, this weekend revealed its plans for an IPO, which it hopes to complete as early as next month – just about the time we will be revealing the 2005 Retailers’ Retailer winners. The La Tasca move is not a testing-the-water exercise, the group insists. It has already done much of the City spade-work and expects to have a prospectus for a launch on AIM out in a fortnight. It will nonetheless be a real test of the confidence that the broad investment community has in the restaurant sector. It is worth noting that the short-list for the Deal of the Year category for this year’s Retailer awards (also announced this weekend) is dominated by pub rather than restaurant transactions. Wagamama’s £63m refinancing is the one exception. La Tasca currently operates 45 tapas bars in the UK, plus two in the US, with plans for another 10 in the next 12 months. It also has two sites for its new La Vina concept open in Hale, near Manchester, and Liverpool. Group sales are around £50m on an annualised basis and it will expect to gain a stock market valuation of £50m to £60m. When James Horler, now chief executive, and John Barnes, now chairman, led the management-buy-in of the company in September 2001, the asking price was £28m. The fact that Penta Capital, their private equity backer, will retain a significant minority stake after the float will give extra reassurance to would-be investors that La Tasca remains a sound bet. Wagamama’ refinancing did much to boost interest in the eating-out sector, not least because of the valuation it received. If La Tasca does get its IPO away, it will add to the impetus and possibly spark a wider round of restaurant deals this coming year. o Talking of the Retailers’ Retailer awards, the short-lists were indeed published this week for the 2005 categories. Voting is now under way. The good news is that the past 12 months has seen the spotlight fall on a large number of new and emerging concepts, especially in the eating-out arena, bidding to take on the mantle of the likes of La Tasca and Wagamama There have also been some notable come-backs. So we have introduced two new categories – Best New Concept and Best Turnaround – to reflect more fully the entrepreneurial nature of the market. All that remains now is for the industry’s leaders to take a few minutes out to cast their votes. The winners of all categories will be announced on February 24 at The Dorchester hotel in London. See you there.