Loungers strikes deal to be bought by US investment firm for £338m

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Fortress Investment Group said it has made an offer for the UK hospitality group through a newly-formed investment vehicle.

Cafe bar business Loungers has agreed to be bought by a US investment group in a deal which values it at about £338 million.

Loungers, which operates the Lounge, Cosy Club and Brightside brands, operates 280 venues across the country. Fortress has offered 310p for each Loungers share, which represents a premium of about 30% to its closing price on Wednesday.Fortress said it thinks Loungers has a “strong and differentiated position”, having grown its locations and sales in recent years “in spite of the recent challenges faced by the wider hospitality sector”.

The group’s managing director, Domnall Tait, said: “This growth, and management’s continued commitment to the business, give us confidence in the company’s growth potential and in the opportunity to increase value.”Loungers opened its first site in Bristol in 2002, and now runs its cafe bars primarily in suburban high streets and small town centres, and Cosy Club restaurants in city centres.

Loungers chairman Alex Reilley said the group has “come a long way” since first opening, adding: “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.

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