28th May 2024 10:14
(Alliance News) - Revolution Bars Group PLC on Tuesday said it rejected a takeover offer from fellow AIM listing Nightcap PLC, after the board received legal advice and concluded the plan was unfeasible.
The Manchester-based bar chain, which operates the brands Revolution and Revolucion de Cuba, announced in April that the company was facing financial difficulties stemming from the ongoing cost-of-living-crisis and recent train strikes in the UK.
Following this, the company's shares were temporarily suspended from trading on AIM after failure to publish results, and management declared they were embarking on a restructuring plan.
The plan outlined the closure of 18 locations and a fundraise of GBP12.5 million via a firm placing, subscription, placing, and open offer, all at an issue price of 1.00 pence per share.
Revolution shares were down 6.3% to 1.41p in London on Tuesday morning. Nightcap was down 10% to 3.50p.
Revolution said it was willing to consider offers for the company, and in May, Revolution held exploratory talks with Nightcap, a London-based bar operator and owner of brands such as The Cocktail Club.
These discussions led to a non-binding proposal which would have required Revolution to proceed with its restructuring plan, but not the proposed fundraise.
According to Revolution the proposal was conditional on two equity raises as opposed to one, and included "significant time, material cost and potential untested legal and procedural issues."
Despite rejecting Nightcap's offer, the board remains open to alternative proposals from Nightcap and others, it said.
By Elijah Dale, Alliance News reporter
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