Soho House & Co., the members’ club operator known for attracting celebrities and creatives, is set to go private after agreeing to a $2.7 billion deal with a consortium led by New York-based MCR Hotels.
The agreement, announced Monday, values Soho House’s common stock at $9 per share and includes the refinancing of its existing debt.
The announcement sent the share price of Soho House up by more than 16% during pre-market trading on Monday.
The deal offers $9 in cash for each share of Soho House common stock, representing a 17.8% premium over Friday’s closing price of $7.64 and an 83% premium over the closing price on December 18, 2024, the day before Soho House disclosed it had received the initial approach.
The transaction implies a total enterprise value of about $2.7 billion, including debt, and marks a significant turnaround for a company that went public in 2021 at $14 a share but struggled with mounting losses and share price volatility.
Upon completion of the buyout, Soho House’s shares will be delisted from the New York Stock Exchange, ending its brief tenure as a publicly traded company.
Andrew Carnie, chief executive of Soho House, said the deal reflected shareholder confidence in the company’s growth trajectory.
“Since our IPO in 2021, we’ve focused on building a stronger, more resilient business. Against a backdrop of challenging economic conditions and global uncertainty, from 2022–2024 we delivered consistent, disciplined growth with revenue increasing at an average annual rate of double digit growth, and Adjusted EBITDA growing at over 50% annually,” Carnie said.
Tyler Morse, chairman and chief executive of MCR, said the investment was a chance to combine operational expertise with one of hospitality’s most distinctive brands.
“MCR’s investment in Soho House represents a strategic opportunity to combine our operational expertise with one of the most distinctive brands in hospitality. Our shared goal is to safeguard the member experience, drive sustainable international growth for House members, and protect and expand the cultural and creative foundation that has made Soho House a global industry leader,” Morse said.
Financial backing from Apollo and Goldman Sachs
The investor group is led by MCR Hotels, whose portfolio includes notable properties such as the TWA Hotel at JFK Airport, The High Line Hotel, and the Gramercy Park Hotel in New York, as well as London’s BT Tower.
MCR, one of the largest hotel owners in the US with 30,000 rooms, has also expanded into hospitality software through assets like Stayntouch and Optii.
MCR’s bid is supported by Apollo Global Management, which, The Wall Street Journal reported, citing sources, is providing over $700 million in debt and equity financing.
Apollo’s involvement is structured as a hybrid capital solution, with part of the proceeds earmarked to refinance Soho House’s senior secured notes.
Goldman Sachs Alternatives, already a significant shareholder since 2021, will roll over most of its existing shares and contribute additional capital to the deal.
The investment arm has backed Soho House through its Hybrid Capital business, which will continue to support the brand.
Ashton Kutcher joins board as part of investor consortium
The transaction will also bring in new strategic investors, including technology investor and actor Ashton Kutcher.
Kutcher, who has built a reputation in Silicon Valley as a successful backer of early-stage companies, will join Soho House’s board of directors once the deal closes.
Other long-term shareholders, including Richard Caring and founder Nick Jones, are also rolling the majority of their holdings into the private entity.
A global network with a cultural cachet
Soho House, founded in London in 1995, operates members-only clubs in major cities across Europe, North America, and beyond.
Membership, which can run into thousands of dollars annually, provides access to private dining spaces, bars, lounges, and a range of cultural events, from live music and readings to screenings.
The clubs have long attracted celebrities, musicians, designers, and artists.
Locations in London, New York, and Los Angeles became staples of creative culture, with appearances from the likes of Lady Gaga and Prince Harry and Meghan Markle.
The brand even received a pop culture boost when its Manhattan club featured in an episode of “Sex and the City.”
Unlike traditional business-oriented clubs, Soho House cultivated a more relaxed and creative atmosphere, discouraging suits and ties, and sometimes offering artists memberships in exchange for their work.
Financial performance and challenges
Soho House’s journey as a public company has been turbulent.
After listing in 2021, shares initially traded at $14 but fell sharply as losses mounted and growth wavered.
Investors expressed concern over the uneven economics of the membership model, which depends heavily on expansion into new markets.
In recent quarters, however, performance has improved.
Soho House recently posted its third consecutive quarterly profit, with second-quarter membership revenue rising 15.9% year-on-year to $118.6 million.
The stock had been climbing steadily before the buyout news, reflecting cautious optimism about its turnaround.
Going private is expected to give the company greater flexibility, removing the pressure of quarterly reporting and allowing management to pursue long-term strategies without public market scrutiny.
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