Quadrant Private Equity hands restaurant chain to lenders
Quadrant Private Equity is set to have the spotlight thrown on it following its decision to hand over control of its restaurant chain, which includes Rockpool Bar & Grill, to its lenders.
While the finance group still has its Fitness and Lifestyle division, its restaurant interests have suffered from challenging economic conditions, where consumers are cutting back on spending, particularly affecting mid-market restaurants.
Insiders at the private equity firm report that the luxury restaurants in its portfolio, such as Rockpool Bar & Grill, Spice Temple, Sake Restaurant and Bar, The Cut Bar and Grill, and Bar Patron, remain profitable, along with El Camino Cantina.
However, several mall-based outlets operating under the Fratelli Fresh brand have been unprofitable, leading to some closures.
The group operates around 50 restaurants, with about a dozen in the luxury segment, and business will continue as usual despite ongoing challenges that prompted Quadrant to explore various options for a buyer.
At one stage, the private equity firm considered splitting the group to sell its components individually.
Formerly known as The Rockpool Dining Group, its restaurants are now part of the Pacific Concepts and Hunter Hospitality brands, with Hunter managing around a dozen luxury establishments.
Metrics Credit has taken control of the business after Quadrant opted not to inject additional equity into a group burdened with debt between $100 million and $200 million. About six months ago, Metrics acquired other lenders, including those from South Korea, and has since appointed new management to implement a revised strategy that may involve further investments.
Quadrant initially acquired the restaurant group which includes Spice Temple and Rockpool in 2016 for nearly $100 million through its Urban Purveyor Group (UPG) from Neil Perry.
While Perry was involved in the early stages, he no longer has any stake in the business.
Quadrant purchased UPG, Australia’s largest restaurant group, a year earlier for approximately $200 million, before adding Fratelli Fresh to its portfolio.
Founded in 1976, UPG managed over 26 award-winning dining and entertainment venues, generating at least $200 million annually. Its portfolio in New South Wales, Victoria, and Queensland included popular spots like Ananas Bar & Brasserie, The Argyle, The Cut Bar & Grill, Sake Restaurant and Bar, Bavarian Bier Cafe, Munich Brahaus, El Camino Cantina, and The Alfred.
The Rockpool Group was one of two businesses in Quadrant’s portfolio significantly impacted by the Covid-19 pandemic, the other being the Fitness and Lifestyle Group, which operates a large chain of gyms, including those under the Fitness First brand.
Post-pandemic, the gyms business underwent a $1.8 billion refinancing, with HPS as the main lender.
Jonathan Jackson, 14th October 2024
