US firm to acquire Loungers for £338m

Loungers plc is set to be bought by US firm Fortress Investment Group (Fortress) in a deal expected to be worth approximately £338m.

Fortress claims it submitted the offer for the UK business via a newly formed investment vehicle. 

Loungers, which owns the Lounge, Cosy Club and Brightside brands, operates from 280 locations nationwide. 

The cash offer, valued at 310p per share, represents a 30% premium to the closing price listed yesterday. With directors of Loungers unanimously advising shareholders to accept the cash offer, the acquisition is set to complete in the first quarter of 2025. 

Loungers' upward trajectory

In a separate financial update to the market this morning, Loungers announced strong results for the 24 weeks ended 6 October. It reported that 17 new sites have successfully opened during this period, with the company on track to launch 35 new venues this year. The group projects that it will end FY25 with 292 sites. 

In the report, Loungers cites revenue growth of 19.2% at £178,327, highlighting a like-for-like sales growth of 4.7%. Adjusted EBITA was up 25% at £29.8m (H124: £23.9m), while profit before tax was £6m (H124: £3.9m), up 51.3%. 

Fortress believes Loungers has a "strong and differentiated position", having significantly grown both its estate and profits over the last few years, "in spite of the recent challenges faced by the wider hospitality sector". 

Alex Reilly, Loungers chairman and co-founder, comments: "Loungers has come a long way since we opened our first site in Bristol in 2002, and we are hugely proud of the jobs we've created, the positive impact we've made and on the UK's high streets and the outstanding hospitality our amazing teams have provided since then.

"We are more ambitious than ever and we see Fortress as being an ideal partner to help us take Loungers into the next phase of its growth journey. We believe that the acquisition represents a compelling proposition for all of our stakeholders and will allow us to execute our ambitious growth plans more decisively and effectively."

You may also be interested in…