Thorium, the company that took the Yates pub group private last August, has made a £3.55m offer for the Santa Fe chain of seven, mostly Mexican-themed, restaurants.
Thorium was set up by private equity fund GI Partners to buy Yates and it now wants to broaden its base by building up a group of recognisable high-street brands.
It sees Santa Fe as complementary to Yates’s 23 food-led Ha! Ha! Bar & Canteens and plans to expand the new acquisition nationwide.
Santa Fe, which specialises in New Mexican and American South-west cuisine, is currently confined to the Midlands and south of England.
“Santa Fe is our first acquisition since we took Yates private and will allow us to further develop our restaurant and food business in the high street,” said Mark Jones, chief executive at Yates and a director of both Thorium and Newco, the company set up as a takeover vehicle.
Although operationally profitable, Santa Fe made a pre-tax loss of £58,000 in the year to 27 June 2004 on a turnover of £8.1m.
It has found it hard to raise new equity or procure new sites for expansion and has been further hampered by a relatively high level of bank debt and rising rental and capital expenditure costs.
Thorium has won acceptance for the bid from holders of 57.7% of Santa Fe shares, including chairman Andrew Taee and Seattle Coffee Company founders Scott and Ally Svenson.
As well as Ha! Ha! Bar & Canteens, Yates operates 126 Yates-branded high-street bars and the Forno Vivo Italian restaurant in Tring, Hertfordshire.
by Angela Frewin
Buy this week's Caterer magazine for more industry news and analysis