EG Group acquires Leon in UK – for a cool £100m
The Issa brothers’ EG Group of forecourts continues its foray into food with the acquisition of fast food chain Leon Restaurants. EG Group now plans to open around 20 new sites per year from 2022. The brothers also completed their acquisition of Asda last year, bought over the Cinnabon chain, and had made a bid for Caffe Nero.
With its sites mainly located in city centres and transport hubs, Leon was hard hit by the pandemic and saw a drop in sales of up to 70% during the second lockdown. Leon was forced to enter a two-year company voluntary arrangement (CVA) to restructure and secure the future of the business.
Convenience retailer EG Group operates more than 700 foodservice outlets in the UK and Ireland, of which 310 operate from standalone premises, with brands including Starbucks, KFC, Burger King, Greggs, Sbarro, Cinnabon and Subway. The group also said it saw significant potential for Leon’s convenience retail proposition.
‘Naturally fast food’
Founded by John Vincent, Henry Dimbleby and Allegra McEvedy in 2004, Leon launched with the tagline ‘naturally fast food’. The group has since grown to more than 70 restaurants, including 42 company-owned restaurants operated on leasehold locations.
In addition, it has 29 franchised sites at transport hubs across the UK and five other European markets, principally the Netherlands. The brand pulled out of the US market earlier this year after the pandemic took its toll. The group also has a grocery range in Sainsbury’s supermarkets and a kitchenware and cookware range with John Lewis.
Mohsin and Zuber Issa, co-founders and co-chief executives of EG Group, said in a joint statement: “Leon is a fantastic brand that we have long admired. As established entrepreneurs in the foodservice retail market ourselves, we have a huge admiration for the business that John and the Leon team have built over the years, and firmly believe that their culture and values closely align with our own.
“The acquisition of Leon presents EG Group with a fantastic opportunity to further develop the menu offer, the various concession formats including drive-thrus, and will enable us to significantly build on the existing network by exploring opportunities across our own sites along with other strategic locations.”
Vincent, chief executive of Leon, said: “In some ways this is a sad day for me, to part company with the business I founded 17 years ago in Carnaby Street. But I have had the pleasure of getting to know Mohsin and Zuber across the last few years. They have been enthusiastic customers of Leon, going out of their way to eat here whenever they visit London. They are decent, hard-working business people who are committed to sustaining and further strengthening the values and culture that we have built at Leon, a business that has my Dad’s name above the door.
“Mohsin and Zuber will not just be superb custodians of the Leon brand, through EG Group they have the vision, investment appetite, foodservice expertise and network scale to take Leon to many more people and places. This is what Leon has always been built for and I am confident under the new ownership, the brand will flourish and have even greater appeal to a broader customer base, especially outside of London.”
The Leon sites in Dublin are not affected by the deal – as they are owned and operated by a separate company.