Former Conran restaurant empire D&D to change hands in £100m takeover

The restaurant empire founded by Sir Terence Conran is to change hands for the first time in nearly a decade after its owners entered exclusive talks with a little-known private equity investor.

Sky News has learned that D&D, which owns prominent London restaurants such as the Bluebird in Chelsea, Coq d’Argent in the heart of the City, and Skylon on the South Bank, is close to being bought by Montecito Equity Partners.

Sources said that the talks were several weeks from being concluded and that a deal was expected to place an enterprise value on D&D of about £100m.

If completed, it will be the first time since 2013 that control of Sir Terence’s former business has changed ownership, and will come just over a year after the death of one of Britain’s most influential designers.

It will also represent a bet on the recovery of central London’s fine dining scene in the wake of the pandemic, with D&D’s roughly 40 UK restaurants having been closed for chunks of the last 18 months.

Most of D&D’s sites, many of which became renowned as celebrity haunts, are in the capital, although it also operates restaurants in Bristol, Leeds, Manchester, New York and Paris.

A new venture in Birmingham is scheduled to open next spring.

Little is known about D&D’s financial performance since the start of the pandemic: according to Companies House, its accounts for the period to 30 September 2020 were due to have been filed by Thursday.

The stuttering return of office workers to the centre of London, which has been delayed by emerging strains of coronavirus and permanently reshaped by employers’ differing policies on remote working, has nevertheless offered encouragement to hospitality bosses that hotel and restaurant businesses will regain their financial viability.

Some of the city’s best-known restaurants, such as Le Caprice, owned by the tycoon Richard Caring, have closed their doors permanently during the pandemic, while numerous casual dining chains have been forced into restructuring or insolvency processes.

Sir Terence pioneered new trends in upmarket dining when Le Pont de la Tour near the Tower of London and Quaglino’s in St James’s opened in the early 1990s.

D&D is named after the current chairman Des Gunewardena and deputy chairman David Loewi, who took on the business when they bought a stake in Conran Restaurants in 2006.

In 2013, LDC, the private equity arm of Lloyds Banking Group, took control of the business.

The buyout firm considered listing D&D on the stock market in 2015 but a flotation did not materialise.

A subsequent restaurant venture of Sir Terence’s, which owned outlets including Lutyens on Fleet Street, was forced to call in administrators in 2018.

Interpath Advisory, the former restructuring unit of KPMG UK, has been advising on the sale of D&D as it widens its offering into the provision of general corporate finance advice, according to people close to the process.

Little is known about the investment history of Montecito, which is based in Kensington.

The firm was founded by Pravir Singh, a former UBS executive who “led coverage for a number of the bank’s most substantial billionaire clients”, according to Montecito’s website.

The exact structure of its acquisition of D&D was unclear this weekend, although one insider said it was possible that LDC would retain a small stake in the business.

LDC, Montecito and Interpath declined to comment this weekend, while D&D has been contacted for comment.