West Berkshire Brewery EIS & loan notes

Please note, this offer has now closed (28 June 2019)

This is the last chance to invest in an established award-winning brewery under EIS.

West Berkshire Brewery (“WBB”) is the latest project of David Bruce, co-founder of The City Pub Group – now a multi-million AIM-listed company – and The Capital Pub Company, which was admitted to AIM in 2007 and acquired by Greene King in 2011.

Now WBB is raising £3.5 million – a combination of EIS and unsecured convertible loan notes. 20% of investors’ subscriptions will be EIS and the rest will be non-EIS loan notes.


  • Combined EIS and unsecured convertible loan offer, raising up to £3.5 million in total – final EIS round 
  • Loan note paying 6% gross (not guaranteed) 
  • Interest should be paid twice a year, starting in July 2019 
  • Established brewery with diversified annual revenues of £6.6 million, currently trading at break even 
  • Award-winning British beers
  • 68,000 sq ft state of the art brewery
  • £2.2 million target EBITDA by FY21
  • Current valuation £24.2 million (3.6x revenue, 1.9x net assets) 
  • Target return 2x in 3 to 5 years (not guaranteed)
  • EIS advance assurance received
  • Minimum investment £2,500 (£500 EIS and £2,000 loan)
  • Single company offer with no diversification

Important: The information on this website is for experienced investors. It is not advice nor a research or personal recommendation to invest. If you’re unsure, please seek advice. Investments are for the long term. They are high risk and illiquid and can fall as well as rise in value, so you could get back less than you invest. Tax rules can change and benefits depend on circumstances.

A look inside West Berkshire Brewery – interview with Chairman David Bruce

Recorded on 4 Apr 2019.

How does the EIS/loan notes offer work?

The minimum investment – one “bundle” – is £2,500 and you can buy multiple bundles. Each bundle includes:

  • 100 EIS shares at £5 each (£500) 
  • Four £500 unsecured convertible loan notes (£2,000)

The term of the loan is 5 years from the date of issue. During that time, investors should receive an interest of 6% gross paid biannually (on 31 January and 31 July). The first interest is due to be paid in July 2019. 

At the end of the term, you can redeem your loan notes or convert them into non-EIS ordinary shares at £7.25 per ordinary share. You can also convert the loan to equity at any time in the 5-year period. However, if this is done within three years, EIS tax relief could be compromised.

Please note: rates and returns are not guaranteed. Any interest is normally subject to 20% UK withholding tax deducted at source. Tax rules can change and tax benefits depend on circumstances. These loan notes are unsecured but, as debt instruments, rank ahead of all equity. The loan notes are not covered by the Financial Services Compensation Scheme. Capital is at risk. 

Examples for different investment sizes

  You invest £2,500 You invest £10,000 You invest £50,000
EIS shares
Number of EIS shares 100 400 2,000
Share price £5 £5 £5
Gross cost of EIS shares £500 £2,000 £10,000
Convertible loan
Number of loan notes 4 16 80
Total cost of loan notes £2,000 £8,000 £40,000
Annual interest rate at 6% £120 £480 £2,400
Total interest (5 years) £600 £2,400 £12,000
Conversion share price £7.25 £7.25 £7.25
Number of non-EIS shares per note 69 69 69
Total number of non-EIS shares 276 1,104 5,520

The opportunity

WBB was opened in 1995 by a local couple of beer enthusiasts in a shed at the back of a pub. In 2013 David Bruce, who lives in the area and enjoyed the beers, took a stake in the company and worked with the founders until they retired.

Today WBB produces and sells its award-winning beers to pubs, has listings with Waitrose and Tesco and produces Marks & Spencer’s own label lager. In addition, it owns and operates a successful Taproom & Kitchen and four pubs. It also offers contract brewing and packaging to customers such as Adnams Brewery. 

Since David Bruce first became involved, sales have increased more than five-fold. Estimated revenue for the year ending in March 2019 is £6.6 million and the Company expects to be profitable by the end of next financial year, although this is not guaranteed and past performance is not a guide to the future. 

WBB has so far been funded mainly through EIS (just over £11 million), alongside David Bruce’s significant private investment.  

It is now raising a further £3.5 million through a combination of EIS and unsecured convertible loans. 

EIS rules cap the maximum a company can raise in its lifetime at £12 million. This means WBB can only raise up to another £700,000 under EIS, making this the final EIS fundraise in which investors can participate under current rules. 

The funds raised in this offer will be used for ongoing working capital purposes and to increase WBB’s portfolio of pubs. 

The management’s strategy is to drive profit through its existing operations this year and, once this has been achieved, drive profit further by acquiring more pubs. Both leasehold and freehold pub opportunities will be reviewed. WBB has already raised approximately £1.5 million of this £3.5 million round.


Target returns 

The Company pre-money valuation is £24.2 million, which represents approximately 3x revenue and 1.9x assets. To deliver a target 2x return the Company would need to achieve an exit valuation of at least £50 million. Returns are not guaranteed and capital is at risk.

Forecast EBITDA in FY21 is £2.2 million reaching over £5 million in FY23. Should WBB achieve the forecast, it could be well placed to deliver an exit of £50 million, potentially through an IPO or trade sale, although again there are no guarantees. 

Management team

Chairman David Bruce leads an experienced management team, which has been progressively expanding to support the company's growth.

David has personally invested a significant amount of capital into the business over the years (approximately £500k; he and his family own roughly 10% of the equity of the company). David hopes to build on his success with similar investments such as The Capital Pub Company PLC which provided EIS investors with a significant return on their investment net of tax – note past performance is not a guide to the future. 

David also co-founded The City Pub Company (East) PLC and The City Pub Company (West) PLC, now listed on AIM as The City Pub Group PLC, and has raised over £100 million EIS capital. 

David has a career spanning five decades in international brewing and licensed trade industry. In 1993 he was awarded “Outstanding Services to the Industry” from The Publican. He is and will remain actively involved in the WBB business. 

Risks – important 

This, like all investments available through Wealth Club, is only for experienced investors happy to make their own investment decisions without advice.

This is a single company EIS offer with no diversification. It involves investing in an early-stage business which is by nature high risk and prone to failure. You could lose the amount you invest.

EIS investments are high-risk so should only form part of a balanced portfolio and you should not invest money you cannot afford to lose. They also tend to be illiquid and hard to sell and value. 

Loan notes interest rates are not guaranteed. Any interest is normally subject to 20% UK withholding tax deducted at source. The loan notes are unsecured but, as debt instruments, rank ahead of all equity. The loan notes are not covered by the Financial Services Compensation Scheme. Capital is at risk. 

Before you invest, please carefully read the Risks and Commitments and the offer documents to ensure you fully understand the risks. The value of tax benefits depends on circumstances and tax rules can change. 

Fees and charges

Investors are investing in the company directly so will pay no direct initial or ongoing charges. WBB will pay an introducer fee to Wealth Club of 5%.

Our view

WBB has been transformed under David Bruce’s tenure and there is a great feel about the place. Each time we visited, the Taproom & Kitchen was busy with happy customers. 

David Bruce is one of the most experienced people in the brewing industry and has delivered good returns to EIS investors several times before, although past performance is not a guide to the future. He has also invested significant amounts into WBB himself.

So far £13 million has been invested into the brewery and into developing successful brands and award-winning beers. WBB has excellent marketing and should be well positioned to continue its growth in our view. 

Sales over the last couple of years have been encouraging, however disappointingly the bottom line does not, as yet, reflect the significant capital expenditure into the company.

We consider the new appointments are a positive step, in particular, the new FD, COO and head of on-trade sales. Additional experienced management should strengthen the business, drive sales and hopefully reduce the likelihood of further exceptional costs. If sales carry on growing at the rate they are and costs can be controlled, WBB should be able to deliver a profit. Management is confident this will be achieved, however, there are no guarantees.

Wealth Club aims to make it easier for experienced investors to find information on – and apply for – tax-efficient investments. You should base your investment decision on the provider's documents and ensure you have read and fully understand them before investing. This review is a marketing communication. It is not advice or a personal or research recommendation to buy the investment mentioned. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination.

The details

Single company EIS and loan note
Target return
Funds raised / sought
£1.8 million / £3.5 million
Minimum investment
Last updated: 28 June 2019

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