Fortress and Lion Capital secure £30m loan to support Loungers deal

Lion Capital and Fortress Investment Group have secured a £30m club loan from OakNorth to support the acquisition of Loungers, the UK’s all-day café-bar operators.

Under Fortress and Lion’s ownership, Loungers plans to continue its proven site rollout strategy, opening over 30 new sites a year to capture further market share in “underserved UK locations”.

The strong cash generation and low leverage profile of the business post-acquisition are expected to “underpin continued investment in expansion”.

The strength of the management team is “core” to Fortress’ and Lion Capital’s desire to back the business – the CEO, Nick Collins, has been with the business for over 13 years, and co-founder, Alex Reilley remains chairman.

Founded in 2002 and headquartered in Bristol, Loungers operates three distinct brands – Lounge (252 sites), Cosy Club (36 sites), and Brightside (four sites) – and employs over 9,000 staff.

Known for its all-day, community-focused proposition, Each site is branded and positioned individually within its respective community. The business has also demonstrated consistent like-for-like revenue growth, resilient cash generation, and site success rate.

Founded in 1998, Fortress is a global investment manager with approximately $46bn (£34.6bn) in assets under management.

It manages assets on behalf of over 2,000 institutional clients and private investors worldwide across a range of investment strategies, including private equity, credit, and real estate.

Meanwhile, Lion Capital is a consumer-focused private equity firm based in London, specialising in investments in the consumer sector across Europe and North America.

Alex Reilley, executive chairman and co-founder of Loungers, said: “We’re hugely excited about what the future holds for Loungers. Having the backing of both Fortress and Lion Capital provides us with the firepower and strategic support to continue our ambitious expansion plans while staying true to the culture and values that have made Loungers so special.

“Throughout this transaction, OakNorth has been an outstanding banking partner – responsive, commercial, and supportive at every step. They are long-term supporters of the hospitality sector and have a deep market understanding of the challenges and opportunities facing businesses like ours.”

Stuart Blair, debt finance director at OakNorth, added: “Loungers is a best-in-class operator with a differentiated and highly scalable model. The business has shown impressive resilience through multiple macroeconomic cycles and continues to deliver outstanding site-level economics.

“The management team led by Nick and Alex is world-class which is why they’ve been able to deliver such strong results for decades. It’s been a pleasure to work alongside Fortress and Lion Capital – two highly experienced sponsors with a deep understanding of the hospitality sector – to support the next stage of Loungers’ growth journey.”