Searcy to roll out Champagne bars after MBO

After three years as part of the Alternative Hotel Group upmarket caterer Searcy is back in private hands - which are steering it towards aggressive expansion. James Stagg reports.

Management at contract caterer Searcy plans to roll out its Champagne bar concept to up to 12 sites, having completed a buyout of the firm in an £8m deal.

In addition to up to a dozen Champagne bars, the top-end caterer will also aim to add to its concession business, targeting a total of 20 contracts in the next five years.

Chairman Richard Tear, who led negotiations alongside chief executive Doug Tetley, told Caterer the firm would benefit from returning to private ownership after three years as part of the Alternative Hotels Group (AHG). "We're back to a greater feeling of independence," he said. "Although AHG treated us as though we were an independent business, the market perception was that we were part of a bigger entity."

AHG bought Searcy in June 2007 in a deal thought to be worth £20m. After three years it decided that Searcy was a non-core asset and put it up for sale to concentrate on its other brands, which include De Vere, Malmaison and Village Hotels.

Searcy's management has now returned the firm to private ownership in a management buyout with a market expectation of £7m-£8m. Along with Tear and Tetley, sales director Chris Maddison has taken a significant amount of equity, while a further 25 managers will be offered a stake in the business.

"For me the journey is about getting Searcy back on the map where it should be: providing quality solutions in the concession and B&I markets," said Tetley, who joined Searcy in February from Aramark, where he ran the business services division. "We will look to expand on what we're doing with our Champagne bar business. It has some real legs as an alternative strand to our business model. Westfield has been expanded, doubling in size, and St Pancras continues to do well."

The firm will look for potential sites in other traffic hubs, retail centres and areas with the right footfall demographic. As well as in London, there are likely to be openings in Manchester, Birmingham and Brighton next year.

Tetley added: "We have a relationship with Network Rail at St Pancras and are looking at a couple of other sites. There is a site we'd like to get our hands on in Covent Garden, but at the moment it's wrapped up in a landlord-tenant agreement. We believe there is the opportunity to open between eight and 12 Champagne bars in a three-year time frame."

In its traditional business stream, Searcy currently runs 14 concession contracts, including 40|30 at the Gherkin, the National Portrait Gallery and the Barbican Centre.

Tetley said that the firm had a strong pipeline of contracts, with deals up to 11 years in length, but that Searcy would attempt to add to them with strategically identified opportunities - if necessary, approaching clients already in a relationship with another caterer.

"We have B&I contracts, client concession contracts and Champagne bars and we'll be selective as to how we add to those," he added.

"We do approach people outside of the normal contract tender process, because we want to continue to build Searcy as a brand but also have some fit within the marketplace."

Now its future has been secured, Tear said the business would be in a position to progress with a settled management team led by Tetley.

"The issue was finding a CEO who understood both wings of the business, a background in retail as well as contracts," he explained. "We struggled to find that in the early days, but since Doug started in February he's been well received by all our clients."

SEARCY'S CONTRACTS

West End and west London
• 30 Pavilion Road
• London Transport Museum
• National Portrait Gallery
• The Champagne Bar
• The Hurlingham Club

City of London
• 40|30, The Gherkin
• Barbican Centre
• Inner Temple
• Museum of London Docklands
• St Pancras Grand
• Vintners' Hall

Outside London
• Assembly Rooms, Bath
• The Pump Room, Bath

Searcy edges closer to management buy out >>

Searcys rebrands and commits to B&I market >>

Alternative Hotel Group acquires Searcy's >>

By James Stagg

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