Rockpool empire sliced up as Neil Perry makes his exit

The famed restaurant name is set to be split up as star chef Neil Perry makes his departure.

Star chef Neil Perry is parting ways with the Rockpool group he founded as its private equity owners move to split the company in two. Picture: Toby Zerna

The private equity owner of the famed Rockpool restaurant empire will carve up the high-profile dining group, splitting it between high end and casual dining arms, as famed chef Neil Perry inks his departure.

The Quadrant Private Equity-owned restaurant chain was slugged by the coronavirus crisis and Perry retired last year from Rockpool Dining Group as his plans to buy back most of the premium restaurants that his name is associated with fell over.

Perry had announced a deal earlier last year that would have seen him split from Quadrant and keep the well known restaurant brands Rockpool, Spice Temple and Rosetta, in three states.

But the savaging of the restaurant industry by the COVID-19 pandemic derailed the financial backing for that seven-restaurant buyback deal.

Perry is now readying to open a new restaurant, Margaret, at the Pallas House commercial development in Sydney’s up-market Double Bay.

But the Rockpool chain insists that is recovering after suffering a heavy blow from the pandemic. In its accounts last year its auditor said that there was a “material uncertainty” about its ability to continue as a going concern.

The Rockpool group forged its reputation in fine dining. Richard Hatherly

The restaurant operator’s accounts, revealed last December, showed losses of close to $80m as the pandemic closed fine dining establishments and hit its money-spinning casual outlets.

The company is best known for premium steak house Rockpool Bar & Grill and the Chinese cooking of Spice Temple, but it controls 16 brands and more than 80 restaurants, meaning it was well diversified.

City locations are humming again, and suburban restaurants, which were not as upset by the pandemic, are coming back in vogue.

The company said the split was in keeping with previously announced plans to cut itself into two stand-alone business units – one a premium hospitality business and the other a hospitality business.

The premium restaurant side of the business will be called Hunter St. Hospitality and the casual group will become Pacific Concepts.

As the operational link with Perry, who remains a shareholder, is severed the once famed Rockpool Dining Group name and business will be discontinued.

Hunter St. Hospitality and Pacific Concepts will both be owned by Quadrant and run by the current executive team but the carve up provides more flexibility for an exit.

In 2019, well before the pandemic struck, Quadrant dropped its explorations of selling the business, and hunted for an investor to back expansion in the United States after a review by investment bank Citi.

Hunter St. Hospitality includes the premium Rockpool Bar & Grill, Rosetta Ristorante, Spice Temple, and Saké Restaurant & Bar and has sites in Sydney, Melbourne, Brisbane, and Perth.

Pacific Concepts holds Fratelli Fresh, El Camino Cantina, Bar Patrón, The Bavarian, Munich Brauhaus, WingHAÜS, Beerhaüs and The Argyle. The casual business is in five states and territories in Australia as well as in NZ.

Rockpool grew substantially in the three years prior to COVID-19 – from 17 venues to more than 80 sites.

But sales fell to $262.8m in the last financial year from $325.8m in fiscal 2019 as COVID-19 restrictions bit and it fell to a loss of $79.91m, well below 2019’s loss of $40.39m.

The business wracked up accumulated losses of $224.6m since it was set up, although this may be due to the private equity-style of high-leverage investing.

The company is confident that is can grow again.

Pacific Concepts will chase opportunities in Australia and NZ with a focus on The Bavarian, El Camino Cantina, Fratelli Fresh and WingHAÜS brands. It will also expand using dark kitchens across its network.

Hunter St. Hospitality is also developing a premium cocktail bar and lounge concept, to launch this year, and have a concierge program.

Hunter St. Hospitality and Pacific Concepts chief executive Thomas Pash said there was solid foundations for both large businesses to become successful stand-alone hospitality groups.

“We are thrilled to be in a sound position to finally move the group forward as two separate entities, each with its own exciting journey ahead,” Mr Pash said.