Goldman places bet on Soho House with £560m loan

April 12, 2021

Goldman Sachs is placing a big bet on the growth of Soho House, one of the world's biggest private members' club networks, with a $770m (£560m) loan as it prepares to go public in New York.

Sky News has learnt that Soho House has struck a deal to replace existing debt facilities with Permira Debt Managers (PDM), part of which had been syndicated to the wealthy Reuben family.

Sources said the new financing from Goldman's merchant banking arm would repay an existing PDM loan of £406m and provide further growth capital for the London-based hospitality group.

The new facility would be over the "long term".

Goldman is not currently involved in Soho House's forthcoming initial public offering (IPO) on the New York Stock Exchange, but could be added to a syndicate led by JP Morgan and Morgan Stanley, they suggested.

News of Goldman's financing comes days after Sky News revealed that Soho House had confidentially submitted an S-1 filing for its IPO, which could value the company at as much as $4bn (£2.9bn).

Despite the pandemic forcing many of its clubs around the world to close, the business has proved to be resilient, with barely 10% of its 110,000 members cancelling their subscription.

This year, it plans to open venues in Austin, Texas; Paris; and Rome.

Soho House members pay well over £1,000-a-year in fees to gain access to its venues, as well as discounted hotel rooms and consumer products sold under the Cowshed brand.

It has also launched a chain of Soho Works workspaces which are broadly comparable to the likes of WeWork.

Originally conceived by founder Nick Jones as a networking venue for executives in the advertising, media and creative industries, a Soho House membership has become a status symbol for international executives working in sectors including music, fashion and broadcasting.

Mr Jones, who is married to the broadcaster Kirsty Young, opened its first site on Greek Street in Central London in 1995.

Its clubs have become a home-from-home for A-list celebrities, with the likes of Kate Moss and Eddie Redmayne among those photographed emerging from Soho House parties.

Soho House's expansion has been facilitated by a series of deals, including the sale by Mr Jones of a controlling stake in the company to Richard Caring, the textiles tycoon, in 2008.

That transaction valued the company at about £130m, with a subsequent takeover by Ron Burkle, a Californian supermarket billionaire, four years later attributing a £250m price tag to Soho House.

Both Mr Jones and Mr Caring have remained as shareholders since then‎, with the former continuing to run the business as its chief executive.

Soho House raised another chunk of private funding last summer, but has decided that the capital required for future growth is better-accessed via public markets.

A spokesman for Soho House declined to comment.

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