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Morning Briefing for pub, restaurant and food wervice operators

Tue 4th May 2021 - Earlier opening blocked, Nightcap buys Adventure Group
Lord and Osmond lose legal battle to bring sector reopening date forward: Sacha Lord, night-time economy adviser for Greater Manchester, and serial sector investor Hugh Osmond have lost their legal battle to force the government to bring forward the reopening date for pubs and restaurants indoors. A high court judge dismissed the attempt to bring forward indoor reopenings as “academic” because the hearing would be unlikely to take place before 17 May, when pubs and restaurants in England could welcome customers inside. At the high court last month, Lord and Osmond argued there was no justification or scientific basis for indoor hospitality to be kept closed for five weeks after non-essential retailers in England were allowed to serve customers indoors from 12 April. They said about 60% of hospitality venues did not have outdoor space. The two men said the judgment came alongside a report from the Scientific Advisory Group for Emergencies (Sage), published on 30 April, which stated that the risks of “transmission in hospitality, retail and leisure are relatively low”. Responding to the ruling by Mr Justice Julian Knowles, Osmond told the Manchester Evening News: “This case is not ‘academic’ for an industry that is losing £200m every day it remains closed, for the over three million people who work in our industry, or for the tens of thousands of businesses, suppliers, landlords and contractors forced into bankruptcy by government measures. Our legal action gave them a fighting chance yet once again in 2021, the strong arm of the state has come crushing down on hope and aspiration. The judge said that covid ‘justifies a precautionary or cautious approach on the part of the government’. But when a crucial Sage report is ignored, this goes far beyond caution, and questions need to be asked about when this advice was sought and why this important evidence was not disclosed. I am deeply concerned that the judge’s main reason for refusing judicial review was because our claim ‘was not brought promptly’, even though we issued our claim days after the Roadmap became law on 25 March, with the court taking a month to provide its ruling. This judgment drives a coach and horses through our normal constitutional processes. Are we really being told that we should have issued legal proceedings on the basis of a prime minister’s press conference and a yet to be published set of laws? Our democracy should be better than this. The Roadmap was based on models, not data, and today we have the data. Vaccination, infection and hospitalisation rates are all far much better than was forecasted and the government now has a chance to turn this around, to capitalise on the NHS’ brilliant vaccination rollout, to follow the data rather than arbitrary dates based on outdated models, to believe in vaccines and to get rid of these appalling and severe restrictions once and for all.” Lord said: “We are disappointed with the outcome. While this fight has always been an uphill battle, made harder by the government’s delaying tactics and refusal to mediate, we are pleased that the case has shone a light on the hospitality sector and the unfair and unequal guidance within the recovery roadmap. Through our legal challenges, we have achieved significant outcomes for the sector, abolishing the substantial meal requirement with our previous court action and lobbying hard to remove with the 10pm curfew. Both of these results have had a hugely positive impact on operators nationwide who have been unfairly treated throughout this crisis and undoubtedly saved many jobs throughout the industry. Through our legal action, we have sent a clear, strong message direct to the heart of government. We will continue to advocate for those who have been unfairly impacted throughout this crisis, and despite the outcome, we will continue to hold the government to account and demand evidence-based decisions, rather than those drafted without detailed analysis or based on bias or whim.” The two men said they had decided there was insufficient time to challenge the ruling before 17 May, though Osmond said he was reviewing other legal options in relation to the matter.

164 companies sign up to Propel Premium in two months for exclusive access to the multi-site database and much more: A staggering 164 companies have signed up to Propel Premium since the start of March. A huge draw for businesses is the multi-site database that is now updated and sent to subscribers at the end of every month with a report on new additions. The database comprises 1,716 companies and is growing all the time. The latest version, which subscribers now have access to, saw 84 additions made to the database at the end of April since it was previously released at the end of March, along with a 5,000-word report. The go-to database has the most comprehensive multi-site operator information in the sector – it provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different, and what each business specialises in. In a new feature this year, there is a synopsis of what the business does and significant news associated with it. Companies can also now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The regular single subscription rate of £395 plus VAT for operators and £495 plus VAT for suppliers remains the same. Premium subscribers also receive access to Propel’s library of lockdown videos and Friday Wrap interviews. Propel Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out; regular video content and regular exclusive columns from Propel insights editor Mark Wingett. Email anne.steele@propelinfo.com to sign up.

Nightcap to buy Adventure Group for £1m, further £1.5m of deferred consideration: Nightcap has agreed to acquire the Adventure Bar Group – upon completion of the acquisition, Nightcap will become the operator of an additional nine bars. The bars being acquired are seven established themed bars located in popular London locations, a large outdoor bar, food and entertainment venue in Birmingham, a bar site opening in Birmingham on 17 May 2021 and a 50% interest in a central London roof-top bar. The nine sites include all of the bars branded ‘Tonight Josephine’, ‘Bar Elba’, ‘Luna Springs’ and ‘Blame Gloria’, which predominantly provide a cocktail-orientated drinks offering. The Adventure Bar Group has a pipeline of additional sites and the board of Nightcap believes that the Target Bar brands have significant potential for national expansion to up to 40 locations. In order to fund the UK roll out of the Target Bars’ ‘Tonight Josephine’, ‘Bar Elba’ and ‘Luna Springs’ bar brands and pay down part of the debt associated with the Acquisition, Nightcap announces that it is currently seeking to raise approximately £4 million (before expenses) by way of a proposed placing. The maximum aggregate consideration payable to the vendors is £2.5 million and comprises an initial consideration of £1.0 million payable on completion and up to £1.5 million of deferred consideration, dependent upon the financial performance of the Target Bars. Sarah Willingham, chief executive of Nightcap, said: “I am delighted to announce the acquisition of Adventure Bar Group, so soon after our IPO and initial acquisition of The London Cocktail Club. Tom and Toby have built an enviable portfolio of amazing brands and venues which have delighted their customers for years. Bringing Adventure Bar Group into the Nightcap family was a logical step for them in pursuit of their ambition to realise the full potential of their brands. I am truly looking forward to working with them to realise that ambition. The further expansion of Adventure Bar Group will take place during a time where the opportunity to acquire first class property at attractive rates is unmatched by anything I have seen during my 25 years in hospitality. The acquisition furthermore expands the opportunity to take on different types of property, particularly with the Bar Elba and Luna Springs concepts trading as large outdoor venues, benefitting significantly when trade is restricted indoors and during the summer period. We are all looking forward with much excitement to 17 May 2021 when our entire estate will be able to welcome back customers.” Thomas Kidd, chief executive of Adventure Bar Group, added: “We are delighted to be working with Sarah, Michael, Toby (Rolph, Nightcap chief financial officer) and the team at Nightcap. We have been looking at growth funding options for some time and this is the perfect outcome for us; the experience and knowledge of the senior Nightcap team will be a huge asset to the business as we look to scale and to share our brands like Tonight Josephine with more people around the UK.” The acquisition of Adventure Bar Group is Nightcap’s second deal after buying The London Cocktail Club (LCC), the ten-strong cocktail bar business, in January 2021. The deal coincided with Nightcap’s listing on the Aim market at the beginning of 2021.

Vue upgrades seats before cinemas reopen: One of the country’s biggest cinema operators is to spend £60 million over 18 months on improving its sites, including installing more reclining seats. According to The Times, Vue International will unveil the plans today as it prepares to reopen on 17 May. Tim Richards, its founder and chief executive, said that cinema could be heading for a “new golden age” thanks to a strong slate of upcoming releases as a result of films being put on hold over the past year, including No Time To Die, the latest Bond film. Vue is Britain’s third biggest cinema operator, with 280 sites in ten countries, including 92 in Britain. It is controlled by Omers and the Alberta Investment Management Corporation, two Canadian investment firms. At present Vue plans to reopen its British cinemas on 17 May, probably with a 50% occupancy until restrictions are fully lifted on 21 June. Richards said that after “a tough 15 months it’s going to take the company a year or two to recover”. As cinemas closed in lockdowns, big studios have streamed some of their films for home viewing and some analysts suggest that this could become more widespread, threatening the period of exclusivity for cinemas to show releases known as the “theatrical window”. However, Richards said: “There is a pent-up demand to leave the home like never before. Consumer surveys are showing cinemas in the top three of things people want to do [after] the pandemic.” He cited evidence from markets that had reopened, with cinemas in China, Japan and Australia all breaking box-office records. He was also confident that a deal on a theatrical window of between 31 and 45 days was likely.

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