Man City owner Sheikh Mansour circles The Ivy chain as it goes up for auction

Between West Street and Litchfield Street, in London’s Covent Garden is The Ivy. It is both a haven for theatregoers who need a drink or a front room for celebrities.

A glass lift will whisk you up to the private dining room after passing through the West Street entry, which is often mistaken as a floral shop due to the elaborate floral decor. The main restaurant is located downstairs. A coral-coloured bar with onyx in the middle, surrounded by red leather barstools and pink mohair barstools, awaits guests before they are shown to their table, which has high-backed green Ivy chairs.

Since summer 2005, Richard Caring has controlled The Ivy with its rotating collection of expensive art by artists like Damien Hirst and Tracey Emin, as well as Andy Warhol. Richard Caring is a diminutive former rag-trader who has become a restaurateur. His stable of opulent restaurants, bars, and nightclubs have earned him the nickname “King Mayfair”.

One member said that the Ivy’s clientele had become “a bit more grey”. According to one member, it may have even “needed a thorough cleaning” during the pandemic. The attraction of mixing with celebrities is still as strong as ever. Olivia Colman and Lee Evans are just a few of the celebrities who have been seen eating out in the past weeks.

Another long-time member said, “Every year I think I should stop my membership.” “But you then get to December and have a good night, thinking, “I’ll give this one more year.”

Careing, who spent £32 million in the early 1990s on The Ivy, now believes he can get £1 billion for it. This is an incredible amount of money in a sector that has been hit by rising food, rent, and labour costs.

Is The Ivy worth £1 billion pounds? Who would buy The Ivy?

It is not only The Ivy West Street that is for sale. The Ivy Asia, Ivy Cafe, Granary Square, and Brasserie of Light at Selfridges are all available for sale. Troia is the official corporate name of the Ivy Group. Depending on whom you ask, it could be a cathedral in Puglia or a grape variety, a Portuguese peninsula, or even an Italian word meaning “slut”.

Caring’s Caprice Holdings, whose restaurants include Scott’s Bacchanalia J Sheekey Balthazar Noema Mykonos Daphne’s 34 Mayfair, and Bacchanalia are not for sale. Birley Clubs is not for sale, either. This includes George Club, Harry’s Bar and Mark’s. This could change, however, with the sale process being kept secret and the interested parties involved.

HSBC, or “Hong Kong Bank” as Caring (75) calls it, is in charge of the sale. Caring declined to comment about the sale. Sheikh Hamad Bin Jassim Bin Jaber al-Thani — also known as HBJ — owns the other 50 percent. Caring, who declined to comment on the sale, has a 50 per cent financial interest. The other half is owned by Sheikh Hamad bin Jassim bin Jaber al-Thani, the former prime minister of Qatar — otherwise known as HBJ.

The cynics think that reaching the magical £1 billion is an impossible goal. Sources close to the sale process have pointed out that Troia has been able to achieve financial success despite the odds in recent years.

According to filings, the company earned £55 million before depreciation, interest, taxes and amortization in 2022. Insiders claim that the returns for 2023 will be even higher. Troia has been able to settle its debts to HSBC by paying off approximately £90 million as a result of a decision made to slow down The Ivy Collection. Sources claim that the business is now debt-free.

This would still indicate a valuation multiple of 15 times the earnings — which is significantly higher than the nine-times that Wall Street private equity company Apollo paid to buy Wagamama’s owner The Restaurant Group in the last year. Wagamama, the undisputed king of casual eating, is a popular choice.

Greg Johnson, leisure industry analyst at Shore Capital, said: “Fifteen-times earnings is significantly more than what other restaurant chains in the mid-upper market command.” As the original Ivy West Street is part of the deal, it is possible to view this as a trophy sale. You will only reach that multiple if recent profits are significantly down or if there is an opportunity to open new restaurants in the UK and overseas.

According to those involved in the sale, expansion is being advertised to prospective buyers both in the UK as well as abroad. More than 30 “white spaces” in Britain — areas where new Ivy schools could flourish — have been identified. Sources said that opportunities are also abundant in the Middle East, and the US.

According to reports, Boston Consulting Group, PwC, and other big four accounting firms have conducted due diligence on Troia, focusing on its growth potential and financial projections.

When the Troia auction began earlier this year, at least ten sovereign funds and family offices expressed interest. City sources say that the Abu Dhabi Investment Authority, Mubadala and the UAE fund controlled Sheikh Mansour bin Zayed al-Nahyan of Manchester City Football Club are among the suitors. The sources said that Saudi Arabia’s massive Public Investment Fund was not in the running.

The goal is to narrow down the number of bidders to a few serious names before the end April and complete the sale by June, although this timetable may slip.

Caring, whose second wife Patricia, 42 years old, welcomed their sixth child just two years ago, will keep The Ivy, as well as the other Troia brand names. Caring and HBJ will each sell half their stakes, leaving the Briton to keep 25%. Other options may be considered.

As with any sales process, there are no guarantees. Interest in The Ivy, and sister brands could diminish.

It is clear that we won’t see the septuagenarian businessman for the last time. Caring stated in 2012 that restaurants have always been serious businesses and “not to be played with”. This is a piece of advice that rich suitors who are looking for something new to play with would do well remember.