Soul in the Viaduct. Photo / Jason Oxenham
Major upmarket national hospitality business Nourish Group has been sold in a private deal announced this morning.
Mark Turnbull, a director of Foley Holdings NZ and chief executive of NZX-listed Foley Wines, said the holding company bought Nourish, which owns and operates exclusive restaurants in Auckland, Taupō, Wellington and Queenstown.
Nourish has Soul in Auckland's Viaduct, Andiamo in Herne Bay, Jervois Steak House in Queenstown, Wellington's Pravda Cafe and Grill, Shed 5 on Wellington's Queens Wharf, Britomart's The Chamberlain, The Crab Shack Wellington, Bistro Lago in Taupō, Talulah and The Brit both in Auckland's Britomart.
More than 400 people work for the group, which was planned to be sold to NZX-listed Good Spirits Hospitality in a conditional deal announced last year but later axed.
In November, Good Spirits said it was buying Nourish with 10 venues, which would bring its total venues to around 20. Industry veteran Richard Sigley was to join the Good Spirits board.
But in April, that was all cancelled when Good Spirits told the NZX: "While its major shareholder supported this transaction and agreed to provide the debt portion of the transaction, interest from potential equity partners has been materially impacted by the inability of investors to travel to New Zealand and uncertainty around further Covid protection framework restrictions on New Zealand hospitality businesses in the future."
Today, Foley's Turnbull said: "The holding company has bought 100 per cent of Nourish Group this week. It previously had an investment of 24. 9 per cent in the group for nearly nine years.
"When the Good Spirits Hospitality deal did not proceed, it was felt that there was a significant amount of synergy with other Foley investments in New Zealand," Turnbull said.
Those included the Wharekauhau Country Estate and Foley Wines where significant investment in hospitality combined with the new development at Te Kairanga in the Wairarapa is underway.
Foley is also expanding its Mt Difficulty operations in Central Otago.
No price was put on the deal, with Turnbull saying it was a private transaction.
Good Spirits put $21.3 million on its base purchase price when it announced its deal last November. An additional $5.9m was payable 12 to 24 months after settlement through an agreed earnout formula based on venue outperformance.
Turnbull said today the Foley purchase was significant.
"This demonstrates long-term confidence in the sector," he said of the purchase, which brings more certainty to the group's future.
Foley Wines' brands include Te Karinga, Vavasour, Mt Difficulty, Russian Jack, Dashwood by Vavasour, Roaring Meg by Mt Difficulty, Grove Mill, Martinborough Vineyard, Lighthouse Gin, Sanctuary, Te Tera, Goldwater, Boatshed Bay, Clifford Bay and The Pass.
In the Wairarapa, Foley Wines is finishing a new venue with a distillery, restaurant to seat 100 people with extra private dining room, outdoor terrace, weddings venue and function areas.
A tasting room and guided tours are also planned. The underground barrel hall will meet the growing needs of the Te Kairanga Winery on the same property, the company said.
It is also expanding its Mt Difficulty operations in Central Otago.
"Our ambition is to be New Zealand's most revered wine group through the ownership of iconic wineries in the country's most acclaimed regions, inspiring the most discerning retailers and restaurants around the world," the business says.
Nourish Group said in the two decades it had been running, it had become the "benchmark" for hospitality businesses in this country.
Late last year, Nourish Group restaurant Euro announced it would close, blaming the impact of the pandemic.
Foley Wines is trading today around $1.45 and has a market capitalisation of $95m.