Gourmet Burger Kitchen has been bought out of administration by the food industry tycoon Ranjit Singh Boparan in a deal that will save more than 660 jobs.
Boparan, who bought Carluccio’s in May, has bought 35 of the burger restaurant’s sites. However, under the pre-pack administration deal, 26 other sites will close, with the loss of 362 jobs.
The burger chain, which was owned by the South African company Famous Brands, which also owns Wimpy in the UK, was put on the market as it struggled amid the pandemic and high street lockdown.
But Gourmet Burger Kitchen has been in difficulties since a restructuring deal with landlords in 2018 under which it agreed to close up to 17 sites after the casual dining market became oversaturated.
Gavin Maher, a partner at Deloitte who was appointed joint administrator on Wednesday, said: “The broader challenges facing ‘bricks and mortar’ operators, combined with the effect of the lockdown, resulted in a deterioration in financial performance and a material funding requirement.
“We have been working closely with the management team under very difficult market conditions to try and find a funding solution, and I am glad to be able to announce the rescue of this well-loved brand together with a large proportion of the sites and workforce. However, it’s clearly disappointing that a number of sites have had to close resulting in today’s redundancies.”
Labelled the “chicken king” as he is the co-owner and founder of 2 Sisters Food Group, which supplies about a third of the chicken on UK supermarket shelves, Boparan’s business interests includes turkey producer Bernard Matthews, the upmarket London restaurant The Cinnamon Club restaurant, as well as the Giraffe and Ed’s Easy Diner chains.
Satnam Leihal, the managing director of Boparan Restaurant Group, said: “This latest acquisition is in line with our strategy to grow our restaurant group with quality brands. Whilst it is an extremely challenging time for the sector, we believe quality hospitality businesses will recover in the long term as people return to eating out.”
Boparan is extending his empire as restaurants and pubs face intense financial pressure during the coronavirus crisis.
UK operators were forced to close for several months in March and continue to suffer from local lockdowns in some parts of the country, as well as from low visitor numbers on high streets, retail parks and shopping centres in general.
With profits under pressure, Pizza Hut, Pizza Express, Azzurri Group, which ownsAsk Italian and Zizzi, and the Casual Dining Group, which owns Bella Italia, Café Rouge and Las Iguanas, have all closed outlets, putting thousands of jobs at risk.
Gourmet Burger Kitchen sites to close under the deal
Baker Street, London
Berner Street, London
Brunswick Centre, London
Covent Garden, London
(closed before administrators were appointed)
Tower Bridge, London
Walton on Thames