Oakman looks to raise £4.5m to fund acquisition spree

11 December 2020 by
Oakman looks to raise £4.5m to fund acquisition spree

Oakman Group is looking to raise £4.5m through a sale of shares to capitalise on the post-pandemic market conditions and double the size of its business over the next five years.

The pub group owns and operates 27 pubs in and around market towns in southern England and the West Midlands and has an annual turnover of £44m. It is launching its own investor platform and offering a range of incentives. In the new year, the company will also be setting up a scheme to allow staff to buy shares in the business.

Over the past 13 years, the group has funded its expansion by raising capital from an extended network of individual investors and word-of-mouth recommendations. Founder and executive chairman Peter Borg-Neal said the time is right to accelerate the growth of the company he founded in 2007 by raising capital to fund a trail of acquisitions in 2021. From 11 December the business will give customers, regulars and communities a chance to own part of the business.

Oakman's chief investment officer Steven Kenee said: "We are aiming to raise £4.5m from the sale of shares at £2.75 each. There will be a minimum investment of 350 shares or £962.50 per person. As well buying shares, new shareholders will also receive access to exclusive events, new menu tastings, meet the supplier events and an investors' card, which will give them a range of all year discounts based on the amount invested.

"While these incentives are a way to reward investors, the real reason for putting them in place is to create a closer connection with our customers and to help build a more direct relationship with the Oakman community. To support this, we've created the Oakman Investor Platform to manage the process ourselves, rather using a third party. This characterises our culture at Oakman – always opting to invest in long-term, sustainable solutions, rather than quick and easy wins."

Borg-Neal said: "We've tried to create an offer that allows everyone to be able to take a small stake in their local for less than the cost of a weekly Sunday brunch for two."

Oakman's chief executive Dermot King added: "While Britain's economy and high streets in particular have been hit hard by the pandemic, the end is in sight and we are committed to turn a challenge into an opportunity and do our part to help drive the recovery. By opening more sites, we will not only create a significant number of jobs, but we will also be doing our part to help to regenerate the high street.

"We believe that the long-term changes in consumer behaviour, such as the move to working from home, coupled with the tragic and unnecessary failure of many smaller pubs and restaurants, means that we are well-positioned to gain further market share.

"Our company is financially stable, and once the fund-raising is completed, we will proceed with our development plans. We have over a dozen new sites in our pipeline, most of which we will develop and open next year. We expect many more opportunities to present themselves over the next 12 months and aim to double the size of our existing estate by 2026."

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