Jamie’s Italian the odd bar out, still searching for a buyer

The future of some of Sydney’s best-known restaurants and bars is more certain after a deal struck to save them.

Dixon Hospitality boss Bruce Dixon.

The future of some of Sydney’s best-known restaurants and bars is more certain after a hospitality outfit led by businessman Bruce Dixon struck a deal to acquire the bulk of the collapsed Keystone Hospitality.

Dixon Hospitality is set to take control of Bungalow 8, The Loft, Cargo Bar, The Winery, The Rook, Kingsleys Woolloomooloo, Manly Wine and Chophouse Sydney as part of the deal, which is in final due diligence.

But the arrangement leaves arguably the best known of Keystone’s brands — Jamie’s Italian — still searching for a buyer.

Keystone, which had 1200 employees before it appointed receivers in June, was unable to reach agreement with its lending syndicate made up of private equity outfits KKR and Olympus Capital.

It was earlier rumoured that casino operator Star Entertainment was an interested bidder for the Keystone business, while there was some interest from Fratelli Fresh owners Urban Purveyor Group for parts of the portfolio. That deal is now off the table. Urban Purveyor Group is owned by Quadrant Private ­Equity.

Mr Dixon, the former chief executive of Spotless Group, said Dixon Hospitality had been focused on growing in Melbourne, but this deal — for an undisclosed amount — would “see us secure some great venues that are profitable, well-regarded and represent very good value for our shareholders”.

“The acquisition is moving quickly, therefore we can retain some of the great Keystone staff and get service, quality and capital investment in place so venues are operating at their full potential,” he said.

Ferrier Hodgson receiver Morgan Kelly said negotiations for the sale of the remaining venues were at the final stages.

“Through the competitive bid process run by CBRE Hotels it became clear prospective buyers were most interested in specific venues that strategically aligned with their own businesses,” Mr Kelly said.

“The businesses are all continuing to operate on a business- as-usual basis.”

Dixon Hospitality is expected to list on the Australian Securities Exchange next year, and is backed by a small number of wealthy investors including a fund that was reportedly linked to billionaire James Packer and Collingwood Football Club president Eddie McGuire.