Propel Newsletter Archive Page

D&D London set to accelerate growth in UK and internationally with £60m deal ‘imminent’: David Loewi, chief executive and co-founder of D&D London, has said it is set to accelerate growth both in the UK and internationally with a £60m deal for the business set to be completed. Earlier this month, Propel exclusively revealed an investment group featuring Breal Capital – which has so far this year acquired Brew by Numbers, Black Sheep Brewery, Brick Brewery and Vinoteca – and Calveton, the backer of Byron, was in advanced discussions to buy D&D. Loewi told The Times that deal is “imminent” with the business, which owns and operates circa 40 restaurants across the UK and internationally, set to return to the expansion trail having completed its closure programme. Loewi said the deal would “open the door to enhanced growth and exciting opportunities for its diverse portfolio”. The business has a projected turnover next year of £144m. While D&D has been consistently profitable over the years, it has been buffeted by covid lockdowns, a cost-of-living crisis, Brexit-related staff shortages and the train strikes. It responded by closing seven of its smaller, uneconomic sites, mostly outside London. D&D said the investment from Calveton and Breal would result in a “£40m balance sheet recapitalisation”. While its existing shareholders, Beechbrook Capital and D&D management, will be selling down to its new shareholders, they will remain as investors, with HSBC and Santander continuing to provide debt. Simon Wilkinson, former boss of Byron and tapas chain La Tasca, is joining the D&D board. Loewi also alluded to a return to the expansion trail, saying the investors would “provide us with the financial backing and strategic support to accelerate growth both in the UK and internationally”. Calveton also referenced the business’s growth ambitions, adding: “Our shared vision is to preserve the rich heritage and identities of these remarkable restaurants.” D&D’s growth ambitions are likely to include further expansion in New York, where it already runs Queensyard, while Loewi has started looking for sites in California, Chicago and Boston as well as in the Middle East. He is also on the hunt for further rooftop sites in London. Having turned the Bluebird in Chelsea into a brand – Bluebird Café – Loewi said he was considering creating further brands based on Quaglino’s and the Alcazar in Paris. The sales process, which goes under the name Project Sandon, is being overseen by advisory firm Interpath. Aqua Restaurant Group, the Handa family and JKS Restaurants are all thought to be among the parties that showed an interest in D&D. Its co-founder and former chief executive Des Gunewardena, who is thought to still own a circa 14% stake in the company, was also among the interested parties. Final bids for D&D were due last month. D&D features in the Propel Turnover & Profits Blue Book. Group revenue over the 15 months to June 2022 was £163m, or 90% of pre-covid levels, while earnings were £17m, or 122% of pre-covid. The Blue Book ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email kai.kirkman@propelinfo.com to upgrade your subscription.

Next Who’s Who of UK Food and Beverage featuring 752 companies to be released on Friday: The next Who’s Who of UK Food and Beverage will be published for Premium subscribers on Friday (20 October), at midday. A total of 25 companies have been added to the database, which now features 752 companies. This month’s edition will also include 123 updated entries. The companies, listed in alphabetical order, will have their most recent results reported as well as broader information around Ebitda, plans and trading style available. The database merges Companies House information, interviews and other public information to provide an easy to reference and exhaustive guide to the sector. Premium subscribers also receive access to five other databases: the Multi-Site Database, which is produced in association with Virgate; the New Openings Database; the UK Food and Beverage Franchisor Database; the Propel Turnover & Profits Blue Book; and the UK Food and Beverage Franchisee Database. Premium subscribers are also to get access to the videos from this month’s Talent and Training Conference. They will be sent 13 videos on Friday, 27 October at 9am. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email kai.kirkman@propelinfo.com to upgrade your subscription. Premium subscribers are also being given exclusive access to the recording and slides to Propel Multi-Club Conferences. They also receive their morning newsletter 11 hours early, at 7pm the evening before; regular video content and regular exclusive columns from Propel group editor Mark Wingett.

Just Eat Takeaway to launch talking ‘AI assistant’ in its UK app: Just Eat Takeaway is about to launch a talking “artificial intelligence (AI) assistant” in its UK app, a move that it hopes will net more orders from younger customers. The pilot-stage feature, which will start appearing on customers’ screens by early November, will respond to both voice and text instructions in English and eliminate the need to scroll through menus. Jessica Hall, chief product officer at Just Eat Takeaway, told The Times the feature would speed up the ordering process and should be “exciting” to use. The assistant can directly order a favourite meal or groceries when instructed, respond to queries about dishes and offer personalised recommendations based on users’ previous orders and reviews. The company said it can customise orders and take items through to checkout in seconds. “Customers don’t want to spend ages having to browse, and add things to baskets and press a million buttons. The fact they can talk to their phone and say ‘I’d like a pizza’ and they can have it in half an hour is a great step forward,” said Hall. It comes weeks after Uber Eats confirmed plans to launch an AI chatbot function in late 2023 to customers in the US, UK, Australia and Canada. Hall said Just Eat chose the UK for the new launch due to British consumers being “quite tech-savvy” and a generally welcoming attitude to AI innovation. Hall also pointed to the inclusion benefits of the tool, which will allow people unable to use screens to order solely via vocal interactions. She also confirmed the company was continuing to pilot both robot and drone deliveries. Grubhub, the group’s US unit, now has robots delivering meals over short distances at 270 college campuses and drone deliveries were recently trialled in Ireland and the Netherlands. However, Hall said there were no immediate plans to roll out robot deliveries in the UK as “the right use case” had not yet been found due to distance-management issues.

British firms lose out on VAT-free Chinese shopping spree: Britain’s global rivals cashed in on VAT-free shopping during a major Chinese holiday this month, with the UK missing out due to its tourist tax. China’s eight-day annual Golden Week festival from 1 October saw millions of its citizens visit Europe. Planet, which processes VAT refunds, said sales on 2 October were 67% higher than the day before, reports The Mail. But British firms lost out to those in France, Spain and Italy, which reaped greater rewards from VAT-free shopping. More than 400 chief executives have backed a Mail campaign for the levy to be axed. Companies such as Burberry, and Mulberry want tax-free shopping, which was scrapped in 2021, reinstated.

Safestay to make Edinburgh return as it acquires site for £4.3m: Hostel operator Safestay has acquired a freehold site in Edinburgh for £4.3m as it makes its return to the Scottish capital. The property in Cowgate Street is arranged over six floors and covers 30,000 square foot in total. The first three floors previously operated as a hostel, while the upper three floors are let to two tenants until 2038 generating £133,000 in rent per annum. The tenants are The Society of Advocates and the Solicitors Society, the latter of which is the vendor. Safestay stated: “The building requires general refurbishment to make it ready to reopen in advance of the key summer market next year. Once completed, the hostel will offer 225 beds in a variety of room combinations typically ranging from two to eight-bed rooms, some with en-suite facilities. Edinburgh is a city the company knows well having owned and operated a successful 615 bed hostel for six years in this city until the pandemic in 2021 when it was sold for £16m. The consideration for the acquisition is £4.3m, which will be satisfied from the group’s existing cash resources. As a result, the group’s hostel portfolio now consists of 17 operating hostels and with the addition of Edinburgh, the number of beds across the portfolio increases to 3,476.” Chairman Larry Lipman said: “We never wanted to leave Edinburgh for long and are delighted to return and link up with our other Scottish site in Glasgow. Edinburgh is a truly stunning city and a key destination for millions of young travellers to visit. The property is superbly positioned right in the centre with easy access to all the main attractions and we feel confident, knowing this market as we do, that it will be a strong contributor to the group. Our trading performance over the last 18 months since we have been allowed to trade post pandemic has shown that our market is in good health. Demand and pricing have demonstrably increased which will increasingly benefit us as we expand the portfolio with excellent sites such as this.”