The rumours are true after it emerged that the Pacha Group is on the verge of being sold to a Private Equity firm for a price of around 350 million euros.
Pacha founder Ricardo Urgell revealed the news himself in a detailed interview with the ‘Diario de Ibiza’ confirming the sale which also confirms that Ibiza has gone through a seismic shift in a little over 5 years.
In an emotional interview 79 year old Urgell, one of the most respected club owners in the world, painted a picture of a weary man who has had grown tired of the ‘new’ Ibiza : “it is important that the island does not lose the magic. If we do not take prompt action, it will die of success”, ironic really then that he is selling to a private equity company.
Trilantic Capital Partners by definition is a profit driven company who will be looking to make money on behalf of investors so it will be interesting to see whether there is a clear change of dynamic for the group. Pacha almost singlehandedly invented the VIP table phenomenon in Ibiza but without Urgell as its soul the bean counters will be calling the shots.
For all his verbal bluster and political denouements Urgell has his heart on the island and also understands Pacha’s position and what makes it tick so without him at the centre it will be interesting to see the direction that the newly owned group will take. Time will only tell but expect Pacha bars in every major town in the world and maybe a festival or 2 as the new owners try to cash in on the name.
Coming so soon after Space in Playa den Bossa closed its doors for the very last time this is also a worrying period for the ‘normal’ clubbers out there who don’t want to spend 1000’s of euros on a small wooden table and champagne but want a few beers, a Bacardi and coke and to just dance the night away.
Space made its name by being all about the music whereas Pacha was more about style and being seen, 2 completely different clubbing experiences but both uniquely Ibiza.
With the Space building looking like it will be turned into ‘Ushuaia by night’ the normal clubbers feel they are being marginalised by the VIP culture. This could be an ideal opportunity for other clubs to fill the gap, Sankeys has done a great job so far with organic growth and maybe Eden and Es Paradis can also be part of giving the clubs back to the clubbers.
So with a couple of hundred million in his back pocket Ricardo Urgell will concentrate on projects close to his heart whilst Pepe Rosello may or may not open a hotel in San Antonio to carry on his presence on the island.
These 2 men have done so much for the island but are both now handing over to a new generation of club owners whose priorities will be different to theirs. Whether ‘normal’ clubbers figure in their new business plans remains to be seen.
3 thoughts on “IBIZA SELL OUT: any room for normal clubbers?”
Ricardo is one smart guy! Although it is sad to say adios to such an iconic club owner I’m inclined to see his exit as the island’s back door tipping point to a point of reason.
The new owners of the Pacha brand HAVE to try to monetize their spend. What else might this mean but higher prices and of course expansion. However the vast majority of the clubbing public does not have a bottomless pit of money. They will not pay funny money for their entertainment any longer. Sooner or later the Ibiza VIP culture is almost certain to implode, leading back to “reality.” Normal clubs, good music, hot dreams, happy people dancing, fair prices and wide smiles.
Remember where you read this!
Dr Doom 😎😎😎😎
Assuming the sale goes through, it’s the beginning, not the end. Ricardo and Piti have built up the Pacha Group over 50 years. A private equity firm only has an interest in owning all or part of the group as long as it can’t make a better return on capital elsewhere.
To do that, the accountants will look at each part of the group and see what it contributes. Trilantic can then decide to expand, cut, close or sell-off any or all of those parts. It has no commitment to anything other than maximising profits for its shareholders.
At the moment we really don’t know what the deal means. As a private company Pacha doesn’t have to submit particularly detailed accounts. The most recent figures show about two-thirds of the group’s turnover comes from clubs and restaurants and about a fifth from hotels.
But, Pacha has talked about hugely increasing its interests in hotels, rather than clubs, over the next eight years. Who knows what will happen to those plans? It may be that new owners decide that Pacha’s expertise is in running clubs and there are other companies better equipped to run hotels, even if they’ve still got two cherries on top.
It’s just an educated guess, but I’d be very surprised if we weren’t looking at a very differently structured Pacha Group in a year’s time. What I really wouldn’t like to guess is what that will mean for the club’s guests and staff.