Luke Johnson still ‘optimistic’ on leisure sector after selling stake in restaurant group Ego
Veteran restaurant investor Luke Johnson has said he is still "optimistic" about the leisure sector despite recent high-profile failures.
His comments came after it was confirmed that he has sold his stake in 3Sixty, the parent company of 17-strong restaurant chain Ego, to hospitality behemoth Mitchells and Butlers for what he told City PM was an "excellent price".
It is the latest in a handful of exits from the leisure sector which Johnson's firm Risk Capital Partners has made. Recent sales include its shareholding in the Laine Pub Company to Vine Acquisitions, and Draft House to BrewDog.
But Johnson said he was not strategically offloading holdings in the leisure industry.
"I'm still actively seeking investments and am optimistic about the sector," he said. "I've been involved for a quarter of a century, I've no intention of giving up."
Rising costs have hit restaurants hard this year, pushing the likes of Gaucho and Barbecoa into administration and forcing chains such as Prezzo, Jamie's Italian, Carluccio's and Byron to close sites.
But Ego, which is headed up by hospitality veteran James Horler, has bucked the trend and now plans to expand.
Mitchells & Butlers' investment means the two companies will work together in a joint venture to accelerate expansion. As part of the deal Ego will take over some of M&B's sites.
"It works for us because they've got great sites with a food heritage," Horler told City PM "We know that it will work and we will open regularly within our ability."
The sites are primarily in the Midlands and North, and expansion is expected to be focused in this area.
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