Head of Belgo restaurant chain puts Waterstone's takeover on the menu

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The Independent Online

Luke Johnson, boss of the Belgo restaurant chain, is preparing to bring his no- nonsense brand of entrepre-neurship to the genteel world of bookselling with a bid to buy Waterstone's.

The multimillionaire restaurateur has turned beer and mussels into a highly profitable formula but would be a complete newcomer to the bookselling industry, which may be nervous at the prospect of the ebullient businessman's robust management style.

Mr Johnson, a former director of PizzaExpress, is working with a management buy-in team and is believed to be in negotiations with potential investors to meet the £250m asking price for Waterstone's, which has had a turbulent history since it was founded almost 20 years ago by Tim Waterstone.

Business at Waterstone's has recovered recently under the ownership of HMV Media, which bought the chain from WH Smith in a £300m deal three years ago. The current owners rejected Mr Waterstone's recent £180m bid to buy back his business. Other offers have come from the German media giant Bertelsmann and rival book chains Ottakar's and Borders.

While eyebrows may be raised at the prospect of Mr Johnson's latest proposed diversification, there can be few doubts over his business acumen, which has seen him amass a fortune estimated at £60m.

As negotiations for Waterstone's continue, however, staff at the book chain may be forgiven for fearing that they will be forced to comply with the tough management and cost-consciousness that are features of the catering industry. Mr Johnson's image was damaged last year when he took part in the BBC Back to the Floor series, in which company bosses take on the duties of their employees to understand their working lives better. Infuriated by the complaints of Belgo staff, who were seen toiling in poor conditions, he stormed off the set, telling the series producers to "stick" their programme.

After the incident Mr Johnson wondered "whether my reputation will ever recover" and said he was ready for a period of "hibernation." He emerged to launch a high- profile £1.6bn bid earlier this year for the Whitbread pub chain, but the deal foundered because of his interests in a rival pub group, Punch Taverns.

Although HMV was unavailable for comment yesterday, sources close to Mr Johnson confirmed he was in preliminary talks with investment bankers about a bid for Waterstone's.

The venture would represent a radical departure for Mr Johnson who has built his business empire on nightclubs and restaurants. In 1993 he bought the PizzaExpress chain for £18m and turned it into a company worth an estimated £575m.