Revolution Bars Group has said a takeover proposal from rival bar operator Nightcap is “incapable of being delivered”, as it pushes on with its own plans for a £12.5m fund raise and restructuring.
Revolution said earlier this month that that it was in early stage discussions about selling the company to Nightcap, having put itself up for sale in April. Now the company said it has since had “several meetings and phone calls” with Nightcap, as well as giving the potential buyer information for due diligence, and received a proposal that Revolution believes would be “incapable of being delivered”.
“There were a number of challenges to the delivery of the Nightcap proposal, which was a highly conditional proposal and which was subject to multiple equity fundraisings by Nightcap, assumptions regarding the support of the company’s and Nightcap’s respective lenders, material due diligence, as well as significant time, material cost and potential untested legal and procedural issues,” Revolution said in a stock market update.
The company added that Nightcap’s plans would necessitate two equity raisings and leave it unable to pursue its own restructuring plan as quickly as it had envisaged.
“It is therefore highly likely additional funding would be required, over and above the company’s existing forecast funding requirement, to bridge to the successful completion of the transaction,” Revolution added. “It is unclear who would be able to fund or on what terms noting that existing stakeholders of the company are unlikely to be able to provide additional bridge funding.”
A date for a shareholder meeting to vote on the equity raise and restructuring has yet to be set.
Image © Revolution Bars Group
Send feedback to Tim Burke
Follow Estates Gazette
