Urbium PLC

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Urbium PLC

Vernon House, 40 Shaftesbury Avenue
London
W1D 7ER
United Kingdom
Telephone: 44 20 7434 0030
Fax: +44 20 7434 1413
Web site: http://www.urbium.co.uk

Public Company
Incorporated: 1995 as Trocadero PLC
Employees: 1,222
Sales: £75.3 million (2004)
Stock Exchanges: London
Ticker Symbol: URM
NAIC: 722410 Drinking Places (Alcoholic Beverages); 551112 Offices of Other Holding Companies

Urbium PLC has built up one of the United Kingdom's fastest-growing portfolios of bars and nightclubs, and is the dominant bar owner in London's West End. Essentially launched in 1998, the company has opened a string of some ten Tiger Tiger-branded large-scale nightclubs across the United Kingdom, combining restaurant, bar service, and dancing in a single multifloor complex. The Tiger Tiger clubs feature capacity ranging from 1,300 to 2,000, and target a more affluent 25- to 45-year-old market seeking a less raucous environment than the typical youth-oriented nightclub. Tiger Tiger clubs hold late-night licenses, allowing them to commence restaurant service at noon and continue to operate until as late as 3 a.m. Since 1998, Urbium has opened Tiger Tiger clubs in London (Haymarket), Aberdeen, Croyden, Dublin, Glasgow, Leeds, Manchester, Newcastle, Portsmouth, and elsewhere, and planned to open a new generation of the Tiger Tiger concept in Cardiff before the end of 2005. Urbium, which founded its nightclub operations with the purchase of three West End bars from Luminar in 1998, has continued to build its portfolio of London establishments. The company operates a number of smaller bars and nightclubs throughout the city, including Abacus, Agenda, Alibi, On Anon, Oxygen, Ruby Blue, Strawberry Moons, Sway, Zoo Bar, and others. The dominant bar group in the popular West End section of London, Urbium has been expanding its presence throughout the city into the mid-2000s. Urbium was created through the split of Chorion PLC into its intellectual property and nightclub operations, and subsequently listed on the London Stock Exchange. In October 2005, however, the company agreed to be acquired in a management-led buyout by Electra Partners.

Property Group in the 1990s

Urbium essentially began as a property investment vehicle acquiring the famed Trocadero, on London Piccadilly Circus, in the mid-1990s. The Trocadero itself had been a London landmark for more than 100 years. Located on the corner of Shaftesbury Avenue and Windmill Street, the site had first achieved notoriety as the Argyll Rooms. Opened in 1851, the Argyll Rooms operated as a nightclub, theater, and restaurant. The Argyll Rooms became well known among the city's nobility and other society figures for its masquerade balls, but also for its operation as a brothel in its rooms upstairs. The notoriety of this latter activity, however, led to the loss of the establishment's license in 1878.

Operated by various theater owners until the mid-1890s, the site's true glory came in 1896, when its 99-year lease was acquired by J. Lyons & Co. Lyons refurbished the property as the Trocadero, widely considered as among the world's finest and most lavish restaurants. Indeed, the restaurant and banquet hall inspired the appearance of numerous "Trocaderos" throughout the world. A famous feature of the site, the Long Bar, was added in 1901. In 1916, the site hosted its first concert tea. Later, in the 1920s, the Trocadero launched its own cabaret, which remained a popular destination into the early 1940s.

In the years following the end of World War II, however, the Trocadero lost much of its former luster. By the 1960s, the Trocadero had become outmoded. The restaurant shut its doors in 1965. The site, however, remained a highly prized location, particularly with the importance of Piccadilly Circus as a London destination during the period.

In the 1980s, the Trocadero was acquired by the Burford Group, a high-flying properties group created as an offshoot for a London commodities firm. Led by Nick Leslau and Nigel Wray, Burford set out to transform the Trocadero site into a multifaceted leisure complex, combining retail shopping and various entertainment outlets.

Burford spun off the Trocadero site as a separate company called Trocadero PLC. The new company set out to expand the entertainment portion of the site, adding an Imax theater, an amusement park-styled attraction, the Drop Ride, and, in 1996, the £50 million Segaword, billed as a virtual reality theme park. Yet these failed to attract the desired public.

New management, led by John Conlan and Nick Tamblyn, both formerly of the First Leisure group, took over Trocadero PLC's operation in 1997. The new team decided to take the company into an entirely different direction or, rather, two new directions. The first was intellectual property. The business was to be based on the company's holding of the rights to the characters and works of popular British children's writer Enid Blyton. Acquired in 1996, the former management had intended to incorporate the characters into the Trocadero site.

Instead, the new Trocadero PLC began acquiring other intellectual property holdings and, most notably, the worldwide rights to the Agatha Christie catalog, as well as the rights to the Simenon series of books. In the meantime, the Trocadero itself had run into difficulties, failing to attract a sufficient public. In 1997, Burford Holdings agreed to reacquire the Trocadero site.

Trocadero PLC continued operating under that name into the beginning of 1998, before changing its name to Chorion PLC in April of that year. Part of the impetus for the name change came with the launch of the company's second line of business: bar and nightclub ownership. In 1998, the company reached an agreement with Luminar PLC to acquire three of its West End London bar properties—Oxygen, Zoo Bar/Venom, and Bar Madrid—for £10.9 million. Although observers were somewhat skeptical over the acquisition, Chorion had spotted an opportunity in the bar scene. For Chorion, although the younger market was well served with nightclubs, there were few venues serving the older and more affluent 25- to 45-year-old set. Yet Chorion recognized that this market, with its high level of disposable income, would welcome bars and nightclubs more specifically catering to it.

Chorion then began preparations to launch a new large-scale late-night (that is, open until 2 or 3 a.m.) nightclub concept. Dubbed "Tiger Tiger," the new nightclub, to be opened in London's Haymarket, featured a multifloor concept offering multiple environments, including a restaurant, a bar, and dancing, and a capacity of nearly 2000. The Tiger Tiger club was designed to be contemporary, but not trendy, matching the tastes of its target public, but also in a bid to extend the club's longevity. By not catering to a prevailing trend, the company hoped to avoid a shift in consumer interest as the next trend came along.

Nightclub Leader in the 2000s

The first Tiger Tiger opened to critical, and popular, acclaim in November 1998. Chorion quickly began plans to expand the brand on a national level. Meanwhile, the company continued acquiring London properties in a bid to become one of the dominant nightclub players in that city.

Chorion soon achieved its aim, and by 2000 the company's strong position in the West End section in particular allowed it to claim leadership in the London market. The company was also highly profitable. By the end of 1999, the company posted a 19 percent profit despite the costs of its acquisition and the £6.5 million price tag involved in the creation of the first Tiger Tiger.

The company's strong balance sheet enabled it to launch a full-scale expansion of its nightclub business. Through 2000 and into 2001, the company opened or acquired a number of new sites, focusing on the London market, with the West End remaining at its core. As such Chorion added names such as Loop, Sway, and On Anon, which offered nightclub concepts similar to those of the Tiger Tiger format; the lounge-led bars Babble, Digress, The Boardwalk, and the Warwick, which provided a smaller and lower key setting, targeting predominantly the after-work professional set; and restaurants, including the Sugar Reef, near Picadilly Circus, and Red Cube, near Leicester Square. The company also maintained its original club acquisitions, including Oxygen, Zoo, and Bar Madrid. These, however, targeted a younger crowd.

Meanwhile, the Tiger Tiger brand led Chorion's expansion to the national, and even international, level. The company opened its first Tiger Tiger outside of London in 2000, in England's second largest city, Birmingham. This initiated a quick rollout of the Tiger Tiger brand, and by 2002, the company operated Tiger Tigers in Manchester, Leeds, Portsmouth, and Newcastle, among others. The company also targeted an introduction into the European market, opening its first Tiger Tiger in Dublin, while planning an extension of the brand to Spain, a popular destination for British holiday-goers.

During this time, Chorion's intellectual property business had also grown strongly, to the point at which the company had become one of the most prominent in this segment as well. In 2002, therefore, the company decided to conduct a "demerger" of its two different businesses, spinning off its night-club business into a new, publicly listed entity, Urbium PLC. The intellectual property business retained the Chorion name.

Urbium spent the next year consolidating its holdings. As such, the company put new bar openings on a temporary hold, while it refurbished and upgraded its existing properties. The Tiger Tiger concept received particular attention as the company shifted its model toward still larger capacity venues. Nonetheless, the Tiger Tiger concept proved highly flexible. For example, when the company opened its next new nightclub, in Aberdeen in 2003, it scaled down the Tiger Tiger there to a maximum accommodation of just 1,300 people.

Company Perspectives:

Urbium PLC operates premium bars in high footfall venues in major urban markets, with a substantial food offer and corporate business.

On the whole, the Tiger Tiger concept remained highly successful. Indeed, its flagship club in the London Haymarket even managed to increase its customer base over its first five years in business, a rarity in the nightclub market. The only negative was the group's experience in Birmingham, where the property's location, at the new Five Point complex, did not attract enough of the relatively upscale clientele targeted by the Tiger Tiger concept.

Urbium returned to expansion in 2004. The company acquired two new London properties at the beginning of the year. The company also opened a new bar, Abacus, in London's Cornhill, that year. By the end of 2004, Urbium had acquired yet another London property, the Strawberry Moons nightclub, located near the city's Regent Street. For that purchase, Urbium paid £1.45 million. The company's expansion continued into 2005, with the purchase of another London bar, the Walkabout. That site, renamed the Alibi under Urbium, also marked the group's entry into the City financial district.

Urbium prepared to launch a still more ambitious expansion to take it into the second half of the 2000s. In February 2005, company Chairman Conlan announced the group's plan to acquire or open another 15 new properties in London, and as many as 50 more nationwide.

In June 2005, however, the company received a takeover offer from rival Regent Inns. The company rejected that offer, yet decided to accept bids for the group from private equity groups. As Conlan told the Financial Times: "The sector is going through a period of consolidation and restructuring and that is easier to do in the private arena."

As a result, the company was approached by investment group Electra Partners. The two sides ultimately worked out a buyout agreement, involving members of Urbium's management. In October 2005, Electra set up a buyout vehicle, Lightflower, and acquired Urbium for £113 million. Urbium was said to be considering a change of name at the end of 2005 as it prepared to extend its leading position among the British nightclub circuit.

Principal Subsidiaries

Latenightlondon.co.uk.

Principal Competitors

Compass Group PLC; Whitbread PLC; Mitchells and Butlers PLC; J D Wetherspoon PLC; Enterprise Inns PLC; Greene King PLC; Wolverhampton and Dudley Breweries PLC; Spirit Group Ltd.; Luminar PLC; Laurel Pub Company Ltd.

Key Dates:

1851:: The Argyll Rooms opens near Picadilly Circus in London.
1896:: The site is reopened as the Trocadero Restaurant under J. Lyons & Co.
1982:: Burford PLC is founded as a properties group, which acquires Trocadero and repositions it as a retail and entertainment complex.
1995:: The Trocadero operation is spun off as Trocadero PLC.
1997:: New management steers Trocadero into intellectual property rights management.
1998:: The company changes its name to Chorion and acquires its first three West End nightclubs; the Tiger Tiger nightclub concept is launched in London's Haymarket.
2000:: The first Tiger Tiger nightclub outside of London is opened, in Birmingham.
2002:: The successful expansion of the nightclub business leads to a "de-merger" and creation of Urbium PLC.
2005:: Urbium agrees to a management buyout led by Electra Partners.