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News
Remaining Vagabond sites sold to Airport Retail Enterprises
The two remaining sites of Vagabond Wines at Gatwick Airport have been sold to Airport Retail Enterprises, completing the sale of the business.
As a result of the news, it means the two sites, which employs 122 staff, will continue operation, according to the business advisory firm and the company’s adminstrators Quantuma.
It follows the news that nine other Vagabond sites were sold to retailer Majestic Wines in April.
Andrew Andronikou from Quantuma said that it was “delighted” to have achieved “such great outcomes” for the company, and preserved more than 300 jobs.
He said: “Both acquirers are well positioned to provide funding and operational expertise to support the next phases of profitable growth for the businesses.
In April, the self-pour wine bar chain filed a notice of intention to appoint administrators due to “a legacy of Covid debts”. This came despite Vagabond making £7.4 million worth of revenue in 2022.
The catalyst to calling in administrators appeared to be the closure of Vagabond’s successful Heathrow venue in January due to a “reconfiguration of airport security”, after which the company took the decision to restructure in order to “safeguard the business and protect the jobs of our brilliant team.”
More than £1.3 million had been poured into the Heathrow site, which opened at Terminal 5 in 2022.
Pandemic
In 2018, Vagabond received a £3.5million cap-ex injection from investment firm Imbiba Group. but when the pandemic hit, it forced bars and restaurants to close for with additional requirements, such as table service, meaning additional costs.
Despite being insured with pandemic business interruption insurance indemnity up to £1.36m, Vagabond’s insurer denied all the claims, Finch told db at the time. The business was forced to pursue this unfair decision as part of class action case through the court. Nearly a year later, a judgement from the UK Supreme Court instructed insurers to pay out on business interruption insurance to help cover losses caused by the pandemic.
Following the easing of restrictions – not to mention the resolution of the court case – the future of hybrid wine stores post-Covid seemed to be looking ‘healthy’.
Profits
Last January, Vagabond posted strong results for the financial year 2022, showing year-on-year revenues up 224%, while gross profit grew by 245% to £5.247m.
But the long shadow cast over the hospitality business hasn’t been the only problem. Soaring energy costs subsequently threatened losses across the industry for both workers and suppliers, while pubs and brewers across Britain faced price hikes of 300% and more. Not to mention rising bills.
In January, Vagabond’s co-founder and former director Stephen Finch stepped down and left the company. A statement from Vagabond in March cited “legacy Covid debts, and other well documented cost pressures”, plus the closure of the” highly successful Heathrow venue due to the reconfiguration of airport security” as the reason it was restructuring and appointing administrators.
Rumours soon surfaced of Majestic’s interest and were confirmed within weeks.