31st May 2024 12:24
(Alliance News) - Revolution Bars PLC on Friday said that it had not received any satisfactory proposals for a takeover in its recent offer period, and is now focused on its fundraising and restructuring efforts in order to lift the company out of its financial woes.
Shares in the Manchester-based bar chain owner were up 10% at 1.26 pence each in London on Friday morning.
In April, the company announced that it was exploring a formal sale process, following "a period of external challenges which have impacted the company's business and trading performance". The challenges given related to the ongoing cost-of-living-crisis and train strikes in the UK.
In early May, Revolution Bars said it had held talks with London-based bar owner Nightcap PLC regarding a possible sale.
However, on Tuesday, the company said it had rejected a non-binding proposal, which it deemed "highly conditional...subject to multiple equity fundraisings by Nightcap", and ultimately "incapable of being delivered".
Following this announcement, on Thursday Nightcap withdrew its proposal and said that it no longer intended to make an offer for Revolutions Bars.
Revolution Bars has now concluded its formal sale process, having received no binding proposals for the acquisition of its entire share capital, and is no longer in an offer period.
The company noted that proposals were made for several of its subsidiaries and their assets, though it said none of these would result in a financial return for shareholders.
Alongside exploring a potential sale, in April Revolution Bars said that its recent trading difficulties necessitated the implementation of a restructuring plan.
The proposed plan included "amending and extending the group's secured lending facilities, exiting the leases of certain loss-making sites, and proposing a rent reduction on certain other sites to enable them to return to profitability at a sustainable level."
Revolution Bars expects the plan to return the company to profitability, having reported a pretax loss of GBP22.2 million in its last financial results for the year ended July 1.
In order to finance the restructuring, Revolution Bars said that it would undertake a fundraise for up to GBP12.5 million.
This would be via the placing of 389.0 million shares and a subscription of 661.0 million shares at a price of 1 pence each, alongside an open offer to raise an additional GBP2.0 million.
Revolution Bars said that launching the fundraise is conditional on the restructuring plan receiving court sanction by August 25.
Revolution Bars urged its shareholders to vote in favour of the fundraise at its general meeting, scheduled for June 14, which will allow the restructuring plan to be sanctioned by the court.
Should the fundraise be unsuccessful and the restructuring plan fail, Revolution Bars said it will consider the proposals made for the purchase of its subsidiaries during the now-closed offer period.
By Hugh Cameron, Alliance News reporter
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