Private equity firm Duke Street has sold noodle restaurant chain Wagamama to The Restaurant Group for £559 million, generating a 3.4x return on investment.
Wagamama was established in London in 1992 and operates noodle restaurants offering fresh, pan-Asian cuisine. The restaurants provide noodle and rice dishes, as well as salads and side dishes, juices, hot drinks, wine, sake and Asian beers.
Duke Street acquired Wagamama in 2011 for £215 million when the Group had 70 restaurants. Since then the business has grown considerably and now has 133 restaurants in the UK, 5 in the US and 58 franchise restaurants in Europe, the Middle East and New Zealand.
Wagamama grew its UK revenues by 17% compound annual growth rate between 2015 and 2018 and in the year to August 2018 had revenues of £307 million and EBITDA of £43 million post pre-opening costs.
Peter Taylor, Managing Partner at Duke Street, said: “This is one of the largest ever transactions in the UK casual dining space, a market which has been challenging in recent years. Duke Street has supported an outstanding management team under Jane Holbrook’s leadership to transform the company and ensure that Wagamama has emerged as the standout success story of the UK casual dining sector.”
Jane Holbrook, CEO of Wagamama, added: “Wagamama has enjoyed a very strong track record both financially and operationally, driven by the ongoing successful execution of our growth strategy. Duke Street has been hugely supportive, investing heavily in the key resources to drive our position as the UK’s leading casual dining chain, while also helping us take the business and the brand to a growing international customer base.”