The billionaire brothers behind the petrol station business EG Group have snapped up the fast food chain Leon Restaurants for £100m, just months after acquiring the supermarket chain Asda.
EG Group, run by Mohsin Issa and Zuber Issa, has bought the 70-strong restaurant chain, which was founded in London in 2004 by John Vincent, its chief executive, Henry Dimbleby, Boris Johnson’s national food tsar, and the chef Allegra McEvedy.
The deal will lead to payouts for the trio: Vincent stands to make £15m from his 15% holding in Leon, which is named after his father, while other private shareholders, including the other two founders, hold 15% between them. Vincent and Dimbleby, advocates of healthy eating, coined the concept of “naturally fast food” for Leon, and also developed a school food plan for the government in 2013.
Leon, which employs 700 people, was majority-owned by two private equity firms, Active Partners and Spice Private Equity.
The Issa brothers, who leased their first petrol station in 1999 and now have more than 6,000 across 10 countries, have been on a buying spree, adding more food businesses to their portfolio. They agreed to acquire Asda for £6.8bn last October, although the takeover still needs to be approved by the competition watchdog, and have bid for Caffè Nero. They had even hoped to buy the fashion chain Topshop.
Leon has 42 company-owned restaurants in London and other large cities in the UK, as well as 29 sites run by franchisees at airports and train stations across the UK, the Netherlands, Ireland, Norway, Spain and Switzerland.
The Issa brothers, who have been installing Starbucks, KFC, Burger King, Greggs, Cinnabon and Subway branches at their forecourts, and opened the UK’s first Starbucks drive-through in 2010, said: “Leon is a fantastic brand that we have long admired.”
EG has committed to keeping on Leon’s staff and management team, and will also hold on to its headquarters in London’s Copperfield Street for at least 12 months.
Vincent 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.” He said he had got to know the Issa brothers over the years, and was “confident under the new ownership, the brand will flourish and have even greater appeal to a broader customer base, especially outside of London”.
In January, EG recruited the former Marks & Spencer boss Stuart Rose as chair, to boost its corporate credentials at a time of rapid expansion, which has landed the company with more than £7bn of debt. In October, the group’s auditors, Deloitte, resigned, fuelling concerns about EG’s governance and management.