Nightclub operator Deltic is soldiering on with its proposals for a merger with bar group Revolution, despite Revolution's rejection of its advances.
Revolution, which operates more than 60 bars across the country under the brands Revolution and Revolución de Cuba, is already the subject of a £100m takeover offer from Stonegate, which Revolution agreed in August, although it still needs to be approved by Revolution's shareholders.
Deltic, which has 57 clubs and bars throughout the UK, across brands including Bar&Beyond, ATIK and PRYZM, also proposed a merger, asserting that Stonegate's offer "significantly undervalued" Revolution.
In an announcement yesterday, Deltic said it found it "surprising" that Revolution had made no reference to its proposals in a document relating to Stonegate's offer.
Deltic said: "Unfortunately, Revolution's board has rejected Deltic's merger proposal out of hand and has seen no merit in pursuing merger discussions or conducting any due diligence on Deltic's business or plans for a combined business.
"Deltic continues to progress its own due diligence on Revolution and this has confirmed Deltic's view that the Stonegate offer undervalues Revolution. In order to put forward its merger proposal and discuss with shareholders, Deltic will in due course publish its own profit forecast and a quantified financial benefits statement in respect of a merger, the timing of which will be dictated by the publication of Revolution's full-year results, which are expected on 3 October. In parallel it continues to evaluate a possible cash offer for the entire issued and to be issued share capital of Revolution."
The firm has until 5pm on 10 October to announce whether or not it intends to make an offer for Revolution.
It added: "In the meantime, Deltic emphasises that there can be no certainty that an offer or other proposal will be made for Revolution, nor as to the terms on which any offer may be made."
Stonegate is majority-owned by TDR Capital and runs 689 pubs and bars in the UK, including Slug & Lettuce and Walkabout, which it acquired in December last year. The company was founded in November 2010 following the acquisition of 333 pubs from Mitchells & Butlers.
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