UK’s biggest nightclub operator on the rocks

The UK's largest nightclub operator has said it plans to bring in Administrators as it struggles with higher bills.  Rekom, which owns the Atik and Pryzm brands, said any restructure of the business could see some of its locations close permanently.

The business had been previously run as Deltic Group before it entered Administration in December 2020 (with BDO as Administrators) and was bought by Scandinavian nightclub operator Rekom.

This time round, a notice of intention to appoint administrators "for a number of companies within the group" was filed on Monday.  In a statement, Peter Marks, the group’s chairman, said the notice gives the business "breathing space and protection" to work with lenders, landlords and other stakeholders on a potential restructuring plan.

The firm, which operates around 35 clubs across the country, said the last year had been a challenging time for the industry.  In this case the blame was laid at the door of higher energy prices and a decline in students spending time in clubs, particularly in midweek.

Whether this decline in going out is down to cost-of-living pressures on students, who have only seen maintenance loans rise by approximately 3% (far lower than inflation) or a general decline in drinking is harder to say.  What is clear from research is the proportion of 16-24 year olds who drank alcohol at all fell from 90% in 2001 to 78% in 2016, and from 75% to 60% for those who had drunk once in the last week prior to being surveyed.

Rekon also said in their statement that looking ahead saw further financial problems, including an addition of £2m to the annual wage bill as a result of the rise in the minimum wage announced in the Autumn Statement.

Whilst it is not clear which venues may be affected, the Pryzm in Watford had already closed earlier this month prior to the announcement.  In brighter news, the company reported its Nordic bars Heidi's Bier Bar in Birmingham and Cardiff and Proud Mary in Cardiff and Swansea had "outperformed all expectations".  Its operations in Denmark, Norway and Finland will be unaffected by this news.

So, Scandinavia seems a better bet for your stag or hen do than Watford, although to be honest, it probably always has.