East Asian food chain Itsu plans to open 100 new stores after striking an investment deal with private equity firm
East Asian food chain Itsu plans to open 100 new stores after striking an investment deal with a private equity firm.
The company, founded by Julian Metcalfe, has sold a minority stake to Bridgepoint Capital.
It is the second time Bridgepoint has backed one of Metcalfe’s ventures, after previously investing in his Pret a Manger sandwich chain in 2008.
Thrilled: Itsu, founded by Julian Metcalfe, has sold a minority stake to Bridgepoint Capital
Pret was then valued at £364m but later sold for £1.5billion, handing investors a lucrative return.
Itsu did not disclose the financial terms of the deal.
But Bridgepoint is thought to have paid around £200m for a 30 per cent stake, potentially valuing the chain at more than £660m overall.
Following the deal, Itsu is now poised to open 100 stores over the next five years, creating 2,000 jobs.
Metcalfe, 61, said most of these would be in ‘big towns’ and other locations outside the UK’s major cities, reflecting growing demand in these places from office staff who are increasingly working from home.
He told the Mail: ‘We are thrilled to be teaming up with Bridgepoint again after our success together at Pret a Manger.
Amid all the horror and doom and gloom we have seen recently, this is a huge and very exciting deal for Itsu and everyone that works with us. I also think it’s an incredible indicator of the way that people, during and after the pandemic, have realised that they have got to eat healthier and more nutritious food.
‘That is what Bridgepoint is really investing in. So it is a very positive statement.’
Benoit Alteirac, partner of Bridgepoint, added: ‘We see a global opportunity for Itsu. It combines affordable, convenient, and fresh food with an outstanding operational model coupled with deep-rooted brand values.
‘Their time is now and their ambition, goals and purpose are so relevant in this post-pandemic era.’
The deal is the latest example of a private equity spending spree that has swept through Britain during the pandemic.
It will also be seen as a welcome sign of confidence in the casual dining industry, which has been pushed to the brink by repeated coronavirus lockdowns.
Itsu, which has dishes such as chicken with greens and brown rice on its menu, has 74 stores, including one in New York.
But many rely on lunchtime custom from office workers – and so business has been hit during the pandemic when people have been forced to stay at home.
Last year, it completed a company voluntary agreement – a type of insolvency procedure – to close two stores and slash rents on 53 more.
Metcalfe said he was confident workers would return to the office soon. But he said Itsu was also seeking to capitalise on strong trade it has seen recently in small cities and big towns.
‘We are only charging £7 a head and in places like Brighton and Bristol that is proving very successful,’ he said.
‘We can really take on some of the big giants.’