Soho House to go private in US$2.7 billion deal, Ashton Kutcher to join board

American actor Ashton Kutcher. (AP Photo/Andy Wong)

Soho House is going private in a US$2.7 billion deal led by New York-based MCR Hotels, capping a turbulent market run and financial struggles that erased nearly half of the high-end members club operator’s value since its 2021 debut.

Shareholders of Soho will get $9 per share, a 17.8 per cent premium to the closing price on Friday. Its shares shot up 16 per cent in premarket trading to $8.86 after the company’s Monday announcement.

Actor and tech investor Ashton Kutcher will also be joining Soho’s board following the deal, and the company named hospitality veteran Neil Thomson as chief financial officer to succeed Thomas Allen effective immediately.

Soho was started by restaurateur Nick Jones in 1995 on London’s Greek Street above his restaurant, Cafe Boheme, as a meeting place for creative people. Known for its stylish interiors and exclusivity, the club now has operations across Europe, North America and Asia.

But less than three years after going public, Soho formed a special board committee to explore taking the company private, as the high-end club struggled to turn a profit despite growth in membership and revenue.

Under the new deal, MCR Hotels will get Soho’s publicly traded shares while founder Nick Jones and Executive Chairman Ron Burkle and his investment firm Yucaipa will retain majority control of the business.

Daniel Loeb, whose hedge fund Third Point owns a nearly 10 per cent stake in Soho, had earlier this year urged the company for a “fair” sales process after Soho announced a take-private offer from an unnamed consortium late in 2024.

The billionaire investor had said other parties with experience investing in the hospitality sector may be interested in the asset. He had also called the $9-a-share offer a “sweetheart” deal and pointed to Burkle’s “conflicts of interest and undue influence on the board.”

Burkle’s Yucaipa and founder Jones collectively own about three-quarters of the company.

Loeb’s Third Point did not immediately return a Reuters request for comment on Monday.

Funds managed by affiliates of Apollo Global Management APO.N are supporting the deal through hybrid capital financing, Soho said. The Wall Street Journal had reported on Sunday that Apollo was expected to provide more than $700 million in equity and debt financing for the deal.

(Reporting by Aatreyee Dasgupta in Bengaluru; Editing by Devika Syamnath)