The owners of burger restaurant chain Byron will launch an auction next week as the coronavirus pandemic threatens hundreds of thousands of jobs in the casual dining sector.
Sky News has learnt that Byron, which employs 1,200 people at 51 outlets across Britain, has asked KPMG to begin contacting potential buyers on Monday.
The timing of the sale – with its restaurants closed and the prospects for their reopening uncertain due to the coronavirus lockdown – underlines the pessimism which has engulfed a once thriving part of the economy.
Coronavirus is threatening hundreds of thousands of jobs in the casual dining sector, including Carluccio’s, which has fallen into administration
It was unclear this weekend whether a solvent sale would be possible.
Sources close to the process said that other options would be explored alongside a sale, including a refinancing under the existing majority shareholder, Three Hills Capital Partners.
It is also continuing to examine whether it can access any of the Treasury’s emergency lending programmes, having already used the Coronavirus Job Retention Scheme to subsidise the wages of most of its staff.
KPMG was appointed in March to begin a review of Byron’s options.
Byron was founded in 2007 with two sites, growing rapidly – like many of its rivals – and eventually boasting 71 sites by the end of 2016.
The chain’s profile was inadvertently boosted by pictures of the then chancellor, George Osborne, eating one of its burgers the night before he delivered the government’s comprehensive spending review in 2013.
Its expansion was ill-fated, with dozens of sites saddled with excessive rents and insufficient revenues, forcing the chain into a company voluntary arrangement just over two years ago.
The restructuring saw it wipe out its debts, close 20 sites and slash rents across much of its ongoing estate.
Last year, the company recorded turnover of £70.9m, with a gross profit of £31.6m.
A source said that the COVID-19 outbreak had come at “a frustrating time for Byron”, which is said to have been making progress in its turnaround plan under chief executive Simon Wilkinson.
Mr Wilkinson, a former boss of La Tasca, joined just over a year ago.
He is understood to have placed all of Byron’s hourly employees on minimum-hour payment terms to ensure they were protected during the lockdown.
One insider said KPMG would contact a range of restaurant operators and financial investors as part of the process.
The level of appetite to acquire Byron will reflect wider sentiment about the future of the UK casual dining sector, after leading restaurateurs prepared to warn this week that ministers should not permit the sector’s reopening too quickly.
In a draft letter seen by Sky News, leading industry figures said ending the lockdown without ongoing financial support from taxpayers would lead to the permanent closure of many businesses.
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Restaurant chains have been granted a 12-month business rates holiday, VAT deferral, and access to a separate grant scheme depending upon the rateable value of their properties.
Many, including Burger King and Yo!, the sushi chain, have withheld quarterly rent bills that were due at the end of March.
That support has not, however, prevented the collapse of a number of chains.
Carluccio’s has fallen into administration, with the tycoon behind Giraffe in exclusive talks to salvage a limited number of its sites and jobs.
Wahaca and Prezzo have called in advisers to help restructure their finances and tap government funding, while Chiquito’s has also called in administrators.
Le Pain Quotidien may finalise a sale in the coming days using a pre-pack insolvency process.
Byron and Three Hills both declined to comment this weekend.
https://news.google.com/__i/rss/rd/articles/CBMiW2h0dHA6Ly90aGVsb3BweS5jb20vY29yb25hdmlydXMtYnlyb24tb3duZXJzLWxhdW5jaC1iaWQtdG8tZmxpcC1idXJnZXItY2hhaW4tYnVzaW5lc3MtbmV3cy_SAV9odHRwOi8vdGhlbG9wcHkuY29tL2Nvcm9uYXZpcnVzLWJ5cm9uLW93bmVycy1sYXVuY2gtYmlkLXRvLWZsaXAtYnVyZ2VyLWNoYWluLWJ1c2luZXNzLW5ld3MvP2FtcA?oc=5
2020-05-02 10:34:18Z
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