Coffee Republic's decision to abandon coffee shops for New York-style deli outlets is already proving a success, boosting the group's total sales by 20%.
The coffee business seeks to rationalise outlets to 50 and has already disposed of 35 bars, bringing its total down to 72.
Coffee Republic is seeking to raise an undisclosed sum to finance the transformation of its business.
Chairman Bobby Hashemi said: "We believe our strategy of evolving the business towards the food-led Republic Deli concept will fully exploit the existing 50-bar estate, the customer base and Coffee Republic's brand recognition and operations infrastructure. This will provide a solid platform for restoring shareholder value."
In the 12 months to 30 March, sales at Coffee Republic rose 9% to £30.3m (from £27.8m), but the cost of transforming the company meant pre-tax losses increased to £9.8m from £7.5m the previous year.