Wagamama owner looks to raise £175m as it gets ready to reopen restaurants from lockdown

The Restaurant Group, which is behind the Wagamama and Frankie & Benny’s chains, is set to raise £175 million via a share placing as it prepares to reopen hundreds of sites from lockdown.

The move will give it more financial security and aid plans to open up to 15 more pubs and Wagamama branches per year.

The company is set to reopen pubs with beer gardens from next month and the rest of its estate in May.

The Restaurant Group said it has around 200 sites trading for delivery and takeaway currently, and the performance of those venues has been “very encouraging”. 

Chief executive Andy Hornby sounded an upbeat note about welcoming customers back to sites after months of lockdown. He thinks“people will come out very quickly”.

The Restaurant Group had a difficult 2020, with total sales down 57% to £459.8 million as the hospitality sector grappled with Covid-19 lockdowns and new social distancing guidelines.

During the period the firm underwent a restructure that saw its estate reduced to around 400 sites from 653 as at the end of 2019.

It posted a pretax loss of £127.6 million compared to a £37.3 million loss a year earlier.

The Restaurant Group said: “The board is encouraged by the welcome news of the initial success of the vaccination programme currently being rolled out, and believes the group is well positioned to benefit from a sustained removal of restrictions over time given its previous encouraging trading performance following the first lockdown and the strong operating platform in place.”

But it added that in the near term, the board anticipates that the outlook remains uncertain with trading disrupted while government restrictions for hospitality businesses are in place.