Last minute deal saves Little Chef |
|
|
|
Published
:
Thu, 04 Jan 2007 10:02
|
LONDON: Roadside restaurant chain Little Chef, which went into administration, has got a savior. In a last minute rescue deal, an Israeli property firm, Arazim Investments, and a private equity group, RCapital, are acquiring the troubled restaurant group.
The new owners intend to close down at least 40 of the group's 234 outlets, while most of its 4,000-odd workers will not lose their jobs.
A formal announcement on the deal is expected Thursday.
Little Chef was once part of the Forte hospitality group. It was acquired by private equity firm Permira, which sold it to The People's Restaurant Group, owned by entrepreneurs Simon Heath and Lawrence Wosskow, for 52 million pounds in 2005. Heath had been running the chain after Wosskow, who led the takeover and owned 90 per cent stake, suffered a heart attack. Wosskow wanted to pull out of the venture because of his illhealth.
The firm had gone into administration after suffering losses of three million pounds last year. It had also been facing a payment crisis involving its two main landlords, Travelodge and Arazim.
This will be the third time that Little Chef, founded in 1958 and catering to some 20 million customers annually, has been sold since 2003.
PricewaterhouseCoopers had taken over the administration of the company, and the accounting firm's Ian Green said he is delighted that detailed negotiations held over the Christmas and New Year period by the directors and their advisors have led to the conclusion of the deal.
Under the deal, Heath will continue to serve as the chain's chief executive.
The chain, which grew alongside Britain's motorway network in the 1950s and 1960s, has been largely hit by the dwindling demand because of the healthy food concept and competition.
|
|
|
|
Print this Story
Bingo firm Gala drops flotation plan, sells stake to buy-out company 