Barracuda cuts debts through financial restructure

Pub and bar operator, the Barracuda Group has undergone a financial restructure that sees its debt cut from £247m to £163m. 

The restructure of the 224-strong managed pub group, led by Babson Capital Europe, has converted some of its debt into equity and injected new cash across the business.

Management remain significant shareholders in the business, with 23% of the equity, while the balance is now owned by an enlarged institutional shareholder group. 

Mark McQuater, chief executive of Barracuda, whose brands include Smith & Jones, Varsity, Barracuda Bar, Juniper and Cape, said the restructure provides a firm base for exciting future developments.

“I am delighted to announce the successful refinancing of the group.  The new financial structure delivers fresh equity and much lower debt levels to the group. The level of equity support for the group is encouraging and is firm recognition of the strong business Barracuda has and its great future,” he said.

Last year Barracuda appointed accountancy firm Deloitte to review its financial structure but refuted claims that it was in financial trouble.

In October 2008 it released the statement: “Barracuda has passed all of its banking covenant tests to date and does not require any cash investment to continue trading.  The company and its backers strongly deny any suggestion of administration.”

Today, the group says trading conditions remain challenging and vary between regions and brands but are stronger and more predictable than the last quarter of 2008.

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By Emma White

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