Exclusive – German restaurant group L’Osteria acquires Pizza Pilgrims: L’Osteria, the German pizza and pasta restaurant business, which is backed by McWin, has acquired a majority stake in Pizza Pilgrims, the award-winning Neapolitan pizza brand, for an undisclosed sum, Propel has learned. Originating in Nuremberg, Germany, in 1999, L'Osteria operates more than 200 restaurants across ten European countries, and has been backed by McWin since the start of 2023. L'Osteria will partner with Pizza Pilgrims as it explores international opportunities, as well as further measured expansion in the UK. Pizza Pilgrims said it is set to benefit from L’Osteria’s extensive European network and expertise, as the brand looks to launch in Europe. L’Osteria and Pizza Pilgrims will remain independent brands, and will continue to be developed internationally in parallel by their respective leadership teams. Both said synergies will be realised through the new strategic partnership. Pizza Pilgrims will continue to be led by Gavin Smith and Sophie Gilchriest – who will be promoted to chief executive and chief financial officer respectively. Thom and James Elliot, who founded Pizza Pilgrims in 2012, will also remain involved full time in the running of the business. The brand currently operates 26 pizzerias across the UK and has recently opened inaugural sites in Wales (Cardiff) and Scotland (Edinburgh). New pizzerias are due to open in Manchester, Birmingham and Bristol, as well as London’s King’s Cross in the near future. To date, Pizza Pilgrims’ expansion has largely been self-funded from free cash flow and the company achieves a return on capital employed of more than 80% across mature sites. The company achieved B-Corp certification in February 2024, following a two-year qualification programme. It is anticipated the transaction, which will represent an exit for Imbiba and Pizza Pilgrims’ existing external shareholders, will complete by the fourth quarter of 2025. Propel revealed last October that Pizza Pilgrims had appointed advisors at PwC, as it looked to embark on its next stage of growth. It is thought to have attracted interest from both private equity firms and trade buyers. Thom and James Elliot said: “We are excited about our partnership with L’Osteria – and the opportunity it presents for the business that we love and our wonderful teams. We have constantly strived to make Pizza Pilgrims a better business every day since we started out on our market stall in Soho – and we would like to thank our longstanding board and all of our outgoing investors for their support and shared wisdom over that time. The opportunity for us to move forward and learn from the vastly experienced team at L’Osteria, as well as McWin, is huge. We are delighted that Gavin and Sophie, who have been part of the business for many years, will be stepping up into their new roles chief executive and chief financial officer respectively to lead the business into its next chapter alongside ourselves and the senior management team. There is undoubtedly strong cultural alignment between the two businesses and we’re really excited about the future – for us this is a real ‘one plus one equals three’ partnership. Together, we will continue to nurture the inherent Pizza Pilgrims spirit, whilst putting into action our clear aligned vision to deepen our Neapolitan hospitality and bring it to a growing band of Pilgrims fans both at home and abroad.” Jacek Trybuchowski, chief executive of L’Osteria, said: “Pizza Pilgrims is a strong, successful brand with a clear Italian profile and an excellent team – both of our brands combine a high-quality standard as well as the passion for Italian cuisine and the joy of Italy. The investment marks another milestone on our journey of becoming ‘European champion in casual dining’. Together with Pizza Pilgrims team we are looking forward to entering the next phase of growth.” In June, Pizza Pilgrims reported another year of strong growth, posting record revenue of £34.4m for the year ending 30 June 2024, an increase of 20% on the previous year (2023: £28.7m), as it continued to broaden its geographic reach. The company saw full-year Ebitda climb 21% to £2.9m (2023: £2.4m), an increase of 21%. After exceptional items, the company recorded a marginal loss of £100,000 (2023: profit of £700,000), which was largely driven by the closure of its Oxford site in January 2024, which it said was a strategic decision to strengthen the overall portfolio. The then 25-strong business said its current financial year was proving to be another period of strong growth. At the end of last year, the business reported a circa 14% increase in December 2024 run rate revenue of circa £39m and like-for-like growth of circa 8%, with the Ebitda margin at site level in excess of 20%. The business plans to grow its portfolio to 38 sites by 2027. McWin, the investment firm from food industry entrepreneurs Henry McGovern and Steven Winegar, which also backs brands including Sticks’n’Sushi, Gail’s and pasta chain Vapiano, acquired a majority stake in L’Osteria in January 2023 in a deal that valued the restaurant brand at around €400m. The move was aimed at driving the brand’s growth across Europe, with McWin investing alongside Klaus Rader and Friedemann Findeis, who founded L’Osteria in 1999. The brand made its UK debut with a launch in Bristol in 2016 under a franchise agreement. A further site was subsequently opening in Westquay, Southampton. McWin is believed to have bought out the original UK franchisee last year, as it looks to continue to roll out the brand here. Pizza Pilgrims features in the Propel Turnover & Profits Blue Book, which is available exclusively to Premium Club subscribers and features 1,151 companies. Pizza Pilgrims’ turnover of £34.4m is the 359th highest in the database. 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.