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11 September 2001

PENTA CAPITAL BACKS £28.2 MILLION MBI OF SPANISH TAPAS BARS AND RESTAURANTS BUSINESS LA TASCA

Penta Capital ("Penta"), the independent private equity house, today announces that it has funded the management buy-in of Spanish tapas bars and restaurants business, La Tasca, for a consideration of up to £28.2 million in cash and loan notes. Penta has committed up to £14.5 million to the transaction, with debt funding to support the acquisition and a development programme being provided by the Bank of Scotland.

The purchase of La Tasca has been facilitated through the formation of a new company, The Restaurant People Group, which has been created by Penta and the in-coming chairman, John Barnes, formerly Chairman of Harry Ramsden’s plc. The Group has appointed James Horler, currently managing director of Frankie & Benny’s, the restaurant business owned by City Centre Restaurants plc, as chief executive.

The business has been acquired from its founder Neil Gatt, who opened the first La Tasca restaurant in Manchester in 1993, and with backing from 3i successfully opened further outlets, modelled on the original, in major towns and cities across the UK.

La Tasca currently has 16 restaurants employing a total of 800 people. It is now the leading Spanish tapas brand in the country, serving more than two million customers a year. The business currently has annual sales of approximately £20.3 million and an annual operating profit of approximately £3.0 million. There are already plans in place to open a further five La Tasca restaurants within the next six months.

Craig Armour, director of Penta, commenting on its investment, said:
"The casual dining sector is a growing and dynamic market. La Tasca is a strong operation with a proven formula and we look forward to working alongside a highly experienced and successful management team and supporting the business as it accelerates its growth."

John Barnes, chairman of The Restaurant People Group, added:
"Spanish tapas is currently under developed as a cuisine in the UK and as a substantial supplier to this market, La Tasca has a head start in securing its position as a brand leader in the increasingly popular mid-spend dining market. We are also delighted to announce the appointment of James Horler whose wealth of expertise in the restaurant business and experience of managing a rapidly growing company in this sector will be instrumental in ensuring the future growth of the company."

Commenting on the deal, Alison Campbell, Director of Structured Finance at Bank of Scotland, said:
"This was an opportunity for Bank of Scotland to support a strong management team in acquiring what is already a successful and growing business. We believe they are in a excellent position to roll-out this established concept."