The Tring-based company, which was resently voted Pub Company of the Year at Restaurant magazine’s R200 Awards, raised the entire sum last Friday, in the same week that it opened its eighth site in Abingdon and appointed a new financial director to help grow the business further.
Borg-Neal, the hospitality entrepreneur who founded Oakman in 2007, said the completion of the EIS fundraising leaves the business with a ‘very strong’ balance sheet; with around £7m of equity, £3.9m of shareholder loans and just £1.2m of bank debt.
“We believe the value of the business, net of debt, is around £15m and our freehold property alone is worth over £7m,” he said. “Going forward, we will look to gradually leverage the value of that freehold property whilst maintaining a cautious approach to debt.”
Borg-Neal said it was the lack of support from the banks and undervalued offers from private equity firms that pushed him towards choosing the EIS route for funding.
“Fundraising is always terribly difficult and never more so than during a recession,” he said. “Our task was made even more difficult, by the fact that we had an unsupportive bank in RBS, whose behaviour towards ourselves and others, will almost certainly result in further future news.
“We started looking for funds in April of 2012 and received a number of offers from various private equity sources. However, none of the offers reflected the fundamental value of our business and, despite the pressure, I was determined not to sell out too cheaply.
“The decision by The Government in the 2012 Autumn Statement to extend the Enterprise Investment Scheme provided the opportunity we needed. In February this year we launched a new EIS fundraising round."
Senior industry figure
Oakman Inns & Restaurants has also today announced that Joseph Evans, currently financial controller of Whitbread Hotels and Restaurants, will be joining the pub group as a board director in February.
Having spent 13 years at Whitbread, Evans currently leads a team of 110 people in the division which has an annual turnover of over £1.4bn.
“The fact that Joseph is leaving such a major post to join us for the next part of his career is testament to the esteem with which Oakman Inns is held across our industry and the very exciting future we are building towards,” added Borg-Neal. “Joseph shares my vision of building a ‘best in class’ business that can deliver a tremendous outcome for investors, employees, suppliers and customers alike.”
And last Wednesday (27 November), Oakman re-opened the doors of The Crown & Thistle in Abingdon-on-Thames after a £1.8m refurbishment.
The venue now features an 18-bedroom hotel, 90-cover restaurant, bar and café as well as a separate function room with its own private bar.
“This was the biggest task we have undertaken to date and we have re-opened and restored a beautiful building, which will I hope become a cherished part of Abingdon’s history and attract visitors from all over the UK,” added Borg-Neal.
“We have three major projects planned for 2014 – again based around the Home Counties.”
Oakman Inns & Restaurants’ portfolio of properties includes three in Hertfordshire (The Akeman, the Red Lion, and the Kings Arms); three in Oxfordshire (The Old Post Office, The Blue Boar, and The Crown & Thistle); and two in Buckinghamshire (The Beech House and The Cook & Fillet).