Australian Venue Co. ('AVC') announced that it has added 8 community focused venues of the renowned and popular Sand Hill Road Group to the AVC portfolio.

Australian Venue Co. CEO Paul Waterson says, “that when it comes to delivering a truly local pub experience, Sand Hill Road Group are at the top of their game”.

This acquisition will take 'AVC' to 180 venues across Australia and New Zealand.

WILLIAMS MEDIA (WM) spoke with 'AVC' CEO Paul Waterson (PW) about their most recent acquisition, what their next acquisition will be, their business model and future plans.

WM: What was the strategic attraction for 'AVC' acquiring the 8 Sandy Hill Road venues?

PW: They are classic old pubs, many of which have been around for 100 years plus. These sort of pubs are irreplaceable and are a key part of Melbourne psyche. We already own Melbourne’s oldest and third oldest licensed hotel in the Duke and Imperial. You can never have too many of Melbournes best pubs!

We have watched the Sand Hill Road guys develop their venues over the past 5 years and have been particularly blown away with their success at Espy and Garden State. Most Melbournians would agree that the Espy is Melbourne’s best pub and Garden State is right up there in the top five. Given we have such a strong presence in the Victorian market we thought the timing was right to add these great venues to our portfolio.

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Source: Garden State Hotel

WM: Do you have plans to invest and acquire more pubs in 2020? Any key areas of focus and why?

PW: Yes we are continuing to look for acquisitions. We are about to complete the sale of Studley Park boathouse in Melbourne which we plan to renew as well as new acquisitions in Queensland and Adelaide.

We have been able to roll in more than 150 pubs into our portfolio in the last 3 years. Our systems are extremely sophisticated and well developed. We think we have found a model that allows each of the pubs to retain their own flair and autonomy at the same time provide back office systems, supports and structures that let the pubs be the best they can be.

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Source: Studley Park Boathouse, Melbourne

WM: Any plans for an IPO?

PW:What’s most important to us is that we have great capital partners to help us grow and develop the business. KKR have been brilliant partners to us in that they provide unmatched capital and support for a bit over two years. They have given us access to global leaders in areas like digital and customer loyalty which have enabled us to roll out new technologies.

The one thing about private equity is that you know they are not going to be your shareholders forever. The business has great scale and is delivering excellent growth, if that results in an IPO at some stage down the track then the management team who already own about 20% of the business will definitely stay on and deliver the company though its next stage and beyond.

WM: What is important for you when assessing assets and their people to fit with your existing group and plans?

PW:We are primarily a beverage led business. When we are looking at potential pubs we focus on those venues that fit within that profile. That’s not to say we don’t have some great gastro pubs and gaming venues. Culturally we are a business that is prepared to try new things. Our COO Craig Ellison empowers the venues to ‘have a crack’ as he calls it. We love working with people who want to try new things that create great environments for our patrons. We would love to be known one day as a group that acknowledges and honours the heritage of the pubs we operate whilst still providing different offerings and technology that make the pubs contemporary and attractive to all.

The acquisition believed to be for more than $100 million say industry sources will see eight of Sand Hill Road Group’s iconic Melbourne venues incorporated into the Australian Venue Co. portfolio including flagship establishments:

• Hotel Esplanade ‘The Espy’
• Garden State Hotel
• Richmond Club
• The Posty
• Holliava
• The Bridge Hotel
• Terminus Hotel
• Prahran Hotel

In restoring The Espy to its former glory, The Sand Hill Road team have found a perfect balance between honouring the historical legacy of the building while at the same time building a contemporary beverage and food offering. AVC will continue to work with the Sand Hill Road founders, following the sale to ensure that legacy continues to flourish.

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Source: The Esplanade Hotel

With a footprint that spans across 5 states and 1 territory, AVC employs over 5000 staff across 150 unique venues. The Group has a large collection of Melbourne based pubs including, Harlow, Imperial Hotel Bourke Street, Middle Park Hotel and The Duke.

As a Victorian based hospitality group with strong credentials in operating historic venues, AVC will work closely with the existing team to ensure a seamless transition. Under new ownership, the team will focus on working with each venue to deliver unique and creative experiences for customers while removing administrative burdens for staff.

Australian Venue Co. CEO Paul Waterson said;

“We have long admired the work of Sand Hill Road and everything that they have achieved in re-imaging and restoring rundown pubs. It is a privilege to be entrusted with ownership of these beloved Melbourne establishments and to add such an innovative and driven approach to our group.

“We have a long track record of working in partnership with venues steeped in tradition, adding value where we can, while maintaining the local look and feel that customers know and love. We understand that as custodians of these establishments, we have a duty to the local communities that they serve to provide an outstanding customer experience.

“Like us, the Sand Hill Road team have worked closely with local communities as they have operated and refurbished these iconic Melbourne establishments. We look forward to taking on responsibility for maintaining these core values and enhancing their legacy.”

Andy Mullins, co-founder of Sand Hill Road Group, added that shared values and a focus on community expectations made AVC a logical fit.

“The boys and I are super proud of what we’ve achieved in Melbourne’s pubs over the last 20 years. We’ve been on a similar journey to Paul and the AVC team – we both started out with just one pub in Melbourne, the backing of our mates and the belief in the importance of the local community pub.

AVC have a strong track record of operating pubs across the country that maintain their integrity and character, whilst bringing added value through industry relationships, marketing expertise and a strong team to drive growth whilst staying true to core values. We specifically want to thank each and every staff member who’s worked with us over the past twenty years. And finally, but most importantly, we want to thank each and every customer who’s shared a beer and a laugh across our bars.”

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Sand Hill Road Venues