New bar group Nightcap to IPO on AIM with first acquisition: Nightcap, a new company led by hospitality entrepreneur and ex-Dragons’ Den investor Sarah Willingham, has announced an intention to float on AIM in two weeks’ time and that it has agreed a deal to acquire the London Cocktail Club (LCC) group of bars. The float will aim to raise £6m to give the company a £14m valuation – the deal to by London Cocktail Club will happen at the same time as the float. Nightcap’s vision is to become the UK’s leading bar operating group through acquiring, investing and expanding drinks-led hospitality concepts, such as LCC, as the wider UK hospitality market emerges from what has been one of the most challenging periods of trading for the sector in modern times. The group will work with the existing LCC management team and shareholders to expand the business from ten to a target of 40 sites, in London and other major UK cities, in the next five years. In addition, Nightcap will look to acquire, re-capitalise and roll out other high-quality, drinks-led bar brands that focus on how consumers will want to live and socially interact, post-covid. Sarah Willingham, chief executive of the new group, is hospitality operator and investor with a track record of developing and growing a range of hospitality businesses. As well as co-founding LCC, her previous experience includes PizzaExpress, The Bombay Bicycle Club and Clapham House Group. She is also currently an investor in Tonkotsu Group, where she chairs the board. The Nightcap executive team has both operational and corporate finance expertise and includes Toby Rolph, chief financial officer, who was instrumental in the successful growth and sale of the cocktail bar chain Be At One, together with Michael Toxvaerd, founder and executive director, who previously co-founded and led AIM-quoted NeutraHealth, and grew, previously AIM-quoted, asset manager Rasmala to $1.8bn AUM, as investor and director, before exiting the firm this year. Nightcap’s management team believes that there are exceptional growth opportunities in the hospitality sector, which can be unlocked by supporting and stabilising businesses emerging from the challenges of the covid-19 pandemic. Despite continued pressures faced by the sector, the board of Nightcap is confident that the premium bar market will return to growth, given the long-term demand for cocktails and social interaction in experience-led venues, offering exceptional hospitality and service. With the increased availability of sites, with more favourable rents and incentives from landlords, the Nightcap management believes the group will be well placed in the coming years. Founded in 2010, LCC has grown to ten sites in London and Bristol, characterised by sophisticated drinks, vibrant “party-style” environment and first-class service. It was founded by Willingham, alongside JJ Goodman, Raymond Blanc, David Moore and James Hopkins. Sarah Willingham said: “We are thrilled to be launching our IPO on AIM and to begin our mission of becoming the UK’s leading bar group focusing on brands positioned to thrive in the post-covid 2020s. I’m delighted that LCC is our first acquisition. It’s a great business that I know very well – its model is proven, simple and replicable. LCC has continued to trade well when we have been allowed to open this year and we believe it has the potential for significant growth as we emerge from the covid crisis. The company employs some incredible people and I am looking forward to working with them as we continue to grow the business together. Over the past decade, LCC has carved out its own niche in the capital’s cocktail scene as a place for people to drink amazing cocktails prepared by an award-winning team of bartenders, while in the middle of a party. Its strong performance despite the challenges of this year underscores its appeal to consumers’ desire for a safe, vibrant, party atmosphere and high-quality drinks.” The majority of LCC’s current shareholders will roll their investment into the new vehicle, including LCC co-founder and head bartender JJ Goodman. Goodman said: “I am looking forward to the next chapter for LCC. I believe this investment is going to help us to grow the business that I co-founded and enable it to reach its full nationwide potential. I’m so excited by our vision for Nightcap and LCC, which is why I’ve decided to roll over my shares.” Allenby Capital is acting as nominated adviser and broker to Nightcap on the IPO. The company is targeting a number of institutional investors for the IPO and retail investors will be able to participate directly in the IPO via the Primary Bid platform. The company plans to raise up to £6m of new money and is expected to have a post money valuation of at circa £13m, meaning it will be well capitalised to continue its expansion of LCC to 40 sites. Of the wider objectives of Nightcap, Willingham added: “I couldn’t be prouder of being part of this incredible industry this year. We have had the worst of the worst thrown at us but when we have been allowed to open, we have put a smile on our face and carried on ensuring that our customers have some sense of normality in a safe environment. We are excited about the opportunity to support the bar sector, which has taken such a hit during the pandemic. We believe there is a unique opportunity brought about by market conditions for Nightcap, through targeted investment and our collective expertise, to develop and grow fundamentally sound businesses that have had a tough time, are under pressure and may not have sufficient capital to grow. We want to help them get back to doing what they do best – looking after customers, opening new sites, and giving great people meaningful careers and development opportunities. Ultimately, we want to help create more fantastic venues for customers to embrace and enjoy as we emerge from the Covid crisis.” Retail investors can access the Nightcap IPO offer page via Primary Bid at www.primarybid.com.