Shoosmiths advises Palatine Private Equity on Gusto MBO

Shoosmiths advises Palatine Private Equity on Gusto MBO

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Author: Karen Levin

The private equity team at national law firm Shoosmiths has advised funds managed by Palatine Private Equity on the management buyout (MBO) of Gusto Restaurants and Bars from restaurant group Living Ventures.

Manchester based private equity partner Mark Dawson led Shoosmiths' advisory team with corporate advice from private equity partner Kieran Toal, senior associate Alex Lilley and solicitor Kelly Harvey and banking advice from partner Liz Sweeney and associate Ruth Evans.

Palatine's investment will enable Gusto to grow including launching a new flagship restaurant in Manchester. Gusto currently has nine restaurants in UK city centres, employing over 400 staff.

Commenting on the deal, Dawson said: "Gusto is an ambitious business with a successful brand which is well positioned to expand in the next few years. This investment will enable it to venture into new locations with the benefit of additional funding, as well as retaining the guidance from "key" non-executive directors. It is great to see quality North West based businesses receiving private equity backing for a growth agenda."

Gusto was established in 2007 following a relaunch from Est Est Est, is looking to open more restaurants across the UK over the next three to four years.

The Living Ventures Group was founded in 1999 by CEO Tim Bacon and Commercial Director Jeremy Roberts. The Group which owns other well-known brands including Blackhouse, Australasia, Artisan, The Alchemist and Manchester House recorded group sales of £65m in the year to March 2014 - a 36% increase on the previous year.

Both Bacon and Roberts have invested in the new Gusto business and will stay on as non-executive directors. Gusto's Managing Director Sue Crimes and Operations Director Tony Griffin will join the board, with Palatine's managing partner, Gary Tipper, and investment director Beth Houghton, who led the investment process completing the team. Bacon and the Living Ventures team are currently featuring in a BBC 2 documentary "Restaurant Wars - The Battle for Manchester" pitting their new Manchester House restaurant and its Michelin Star Chef Aiden Byrne against another Manchester restaurant and chef.

Shoosmiths legal due diligence for the transaction was provided by: tax (Tom Wilde), commercial (Rob Cruise), employment (Danielle Ingham and Sarah Booth), pensions (Paul Carney), environmental (Sophie Wilkinson), regulatory (Hayley Saunders), intellectual property (Jo Joyce), data protection (Aisling Duffy) and property (James Wynne, Helen Spink and Lida Khanverdi).