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GI Partners achieves rapid Yates exit

Yates Group, the UK wine bar chain, is being acquired by property tycoon Robert Tchenguiz just nine months after being backed by private equity firm GI Partners.

Bolton-based wine bar owner Yates Group is being acquired by millionaire property entrepreneur Robert Tchenguiz for £200 million. The firm was backed by GI Partners last August in a £93 million deal in which private equity firm GI Partners was reported to have invested around £40 million.

GI Partners is an international private equity firm backed by the California Public Employees Retirement System (CalPERS) and Richard Ellis, the global real estate investment management firm. Its other UK investments have included NHP Healthcare Partnerships, a psychiatric rehabilitation business, and Camperdown House, a data switching centre.

GI has not officially disclosed the return it has made from the Yates deal, but director Phil Kaziewicz told Dow Jones: “We are delighted to have been able to fund and support such a successful turnaround as the one that has taken place at Yates under [chief executive] Mark Jones’ direction.”

Jones is credited with having turned the business around. GI’s investment last year followed the announcement of pre-tax profits of £4.1 million – down from £9.7 million the previous year – on turnover down 1.2 percent at £151.3 million. The turnaround focused on investment, stronger cash generation, margin improvement and reduced borrowings.                  

Tchenguiz is understood to be planning a merger of Yates with his existing portfolio company Laurel to create one of the UK’s largest operators of city bars and pubs with approximately 300 outlets. The outlets include brands such as hogs head, RSVP and Casa.

Bank of Scotland, Dresdner Kleinwort Wasserstein and Kaupthing Bank are providing senior debt finance for Laurel’s acquisition, with Dresdner and Kaupthing also acting as financial advisers to Laurel on the deal.

GI Partners was advised by CMS Cameron McKenna, Warwick Transaction Services, Napthens Solicitors, Pinsent Masons, JC Rathbone and Taylor Wessing.