Struggling night clubs operator Revolution Bars Group PLC (LON:RBG) has rejected the chance to merge with rival Deltic Group.
Deltic, formed out of the remnants of failed late night bars operator Luminar, is dismayed at the prospect of Revolution falling into the hands of the Stonegate Pub Company, which is considering making a 200p per share offer for Revolution, and has offered an alternative proposal that would entail Revolution making an all-share offer for Deltic and retaining its stock market listing.
Deltic’s management envisages that the enlarged group would be run by the current Deltic management team and, perhaps unsurprisingly, the Revolution management team is not keen on this idea.
Deltic believes that a combination of its business with Revolution would “transform the scalability of the enlarged group, provide scope for material synergies and enable the operational issues within Revolution to be better addressed through Deltic's management team taking responsibility for both businesses, creating a powerhouse group in its sector that can exploit further opportunities to both expand and consolidate the market”.
Revolution has indicated it is not even prepared to discuss Deltic’s proposal so Deltic has gone public with its suggestion. Under The City Code on Takeovers and Mergers, Deltic now has until 5.00pm on 12 September 2017 to either make a formal offer or walk away.
Shares in Revolution were up 1.7% at 179p in early deals.