A drink to higher profits Fine-dining restaurants have always been a huge financial gamble. With very high fixed costs -- labour and food -- it’s the fickle wind of public opinion that determines whether you make a 3% or even 5% profit margin. But can you achieve economies of scale at the high end by combining restaurants in a group, à la McDonalds? Back in the halcyon days before COVID-19, Quadrant Private Equity spent a chunk of cash to find out.

In 2016 the Quadrant-backed Urban Purveyor Group paid about $60 million for Neil Perry’s Rockpool Group, which included some of the best restaurants in the country -- Rockpool Bar and Grill, Spice Temple and Rosetta. Urban combined these “premium” properties with a group of more casual venues into a new entity, Rockpool Dining Group (RDG), which ended up with 50 venues, 3000 staff and revenues of about $350m.

RDG boss Thomas Pash said the following year that a “$1 billion IPO (sharemarket listing) was a realistic goal within the next three years”. But, post-COVID, those plans have been put on hold and this week RDG announced a restructure, splitting the business back into two parts: “premium” and “casual”.