Imbiba Leisure EIS

The Imbiba Leisure EIS invests across the leisure and hospitality sector in Central London. Imbiba, led by serial leisure entrepreneur John Connell, is a venture capital business specialising in bars and restaurants. The team has extensive experience developing asset-backed (long leasehold) cash-generative EIS businesses in the pub, bar and restaurant sector. This latest iteration of the fund is looking to raise £10 million.

Highlights

  • Target returns of 2.5x, not guaranteed (after 4 to 5 years and including income tax relief)
  • Creating and developing bars and restaurants with a focus on Central London
  • Asset-backed (long leasehold)
  • Experienced team with good track-record
  • EIS advance assurance received
  • £10,000 minimum investment

The offer

Imbiba, a specialist bar and restaurant operator with a focus on London, has been running for over 18 years. Fuelled by a young, affluent working population and high-spending tourists, the London bar and restaurant market continues to grow: it is this trend upon which Imbiba hopes to capitalise.

It seeks to deliver capital growth through improving the trading and profitability of the investee companies. That involves refurbishment and development, improved operations and the creation of a scalable business model. Where the manager deems it appropriate, bank debt will be used to finance investee company operations. Any long-term gearing will be around 30% to 50% of the company’s expenditure.

Imbiba has a “buy, build and exit” philosophy. It plans to roll out a concept over 5-8 sites, prove the concept works and then sell it. The expected exit route is a trade sale to larger trade buyers or private equity investors after four to five years, not guaranteed.

Imbiba prides itself on being able to match the right location with the right concept. To do so, the team has divided London into a number of ‘villages.’ Each village has its own personality. Camden, for instance, is alternative whilst Chelsea is traditional. The City is for business and the West End is for those who ‘dress down.’ The operating concept or brand of the bar or restaurant must be in keeping with the village in which it is located.

Imbiba can be credited with the highly successful Drake & Morgan, the fast-growing London-based bar/restaurant group which was sold to Bowmark Capital. Successful branded concepts that can profitably grow to 10 sites or more and demonstrate to the next buyer further roll out potential continue to attract very strong exit multiples with plenty of private equity money chasing the best businesses. So far Imbiba has been good at picking scalable and profitable concepts: note past performance is not a guide to the future.

Enterprise Investment Partners will provide fundraising and corporate finance advice to Imbiba.

Fees

Enterprise will charge an initial fee of 2.5% to the investee companies and an annual management fee capped at £50,000 per investee company. The Performance Incentive fee will only be payable to Imbiba once an Investor has received proceeds of at least £1.50 per £1 invested in total in the fund. Enterprise and Imbiba will invest up to £200,000 per investee company. Please see the Information Memorandum for more details of the charges.

Risks

The usual risks with unquoted companies exist with this EIS offer. For instance, EIS investments are illiquid and capital is at risk. Investors should only invest money they can afford to lose. Tax rules are subject to change and tax benefits will depend on individual circumstances. Please see the information memorandum for further details on the risks.

Wealth Club aims to highlight investments we believe have merit, but you should form your own view. You should decide based 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. 20.01.2018

The details

Type
Fund
Sector
Leisure
Target return
2.5x investment
Funds raised / sought
£2.5 million / £10 million
Minimum investment
£10,000
Deadline
Discretionary

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