A leading speciality hospitality operator, The Better Bar Group has 11 sites in Auckland and Wellington.
Brands include The Cav, O’Hagan’s, Doolan Brothers and Danny Doolans.
Seventy five per cent of the purchase ($23.4 million) will be paid in cash funded by a facility of up to $25 million with ANZ Bank, and 25 per cent through the issue of new Veritas shares.
It is expected that The Better Bar Group will generate yearly revenue of more than $31 million, boosting the Veritas annual revenue to more than $90 million.
The purchase is conditional on approval from Veritas shareholders at its annual meeting to be held in November.
Conditions to be met also include landlord and key supplier consents, relevant permits and licences being obtained regarding the day to day operations, and key management staff transferring their employment.
Following shareholder approval, it is expected that The Better Bar Group chairman Richard Sigley will join the Veritas Board, and The Better Bar Group CEO Geoff Tuttle will remain in his role.
“BBC has a strong track record of growth and recent acquisitions have seen their group go from strength to strength under the direction of the senior management, who are considered to be amongst the most experienced and successful hospitality executives in New Zealand,” Mark Darrow, Veritas Investments chairman, said.
“This significant acquisition fits our investment mandate and complements the existing companies within the Veritas group. We see further opportunities for procurement synergies between the companies, complemented by listed company governance and better resources, enabling the businesses to be scaled significantly over time.”
In May 2013 Veritas purchased The Mad Butcher franchisor business, followed by a 50 per cent stake in Kiwi Pacific Foods in December 2013 and the Nosh Food Market business in September 2014.