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Byron outlets set to close in burger chain rescue plan Byron outlets set to close in burger chain rescue plan
(about 5 hours later)
As many as 20 Byron outlets will close in a rescue plan for Byron, the struggling burger chain, approved by lenders and landlords.As many as 20 Byron outlets will close in a rescue plan for Byron, the struggling burger chain, approved by lenders and landlords.
Simon Cope, Byron chief executive, said the company voluntary arrangement meant "a number" of restaurants would close.Simon Cope, Byron chief executive, said the company voluntary arrangement meant "a number" of restaurants would close.
"We will do everything possible to redeploy staff to other sites and initiatives," he said."We will do everything possible to redeploy staff to other sites and initiatives," he said.
No outlets will close immediately, said KPMG, the accounting firm handling the restructuring.No outlets will close immediately, said KPMG, the accounting firm handling the restructuring.
Employees, suppliers and business rates would continue to be paid on time and full, KPMG said.Employees, suppliers and business rates would continue to be paid on time and full, KPMG said.
The CVA needed at least 75% backing from creditors, which included landlords, and 99% voted in favour.The CVA needed at least 75% backing from creditors, which included landlords, and 99% voted in favour.
Byron employs about 1,800 staff.Byron employs about 1,800 staff.
The CVA proposed that 51 Byron sites keep the same rental costs, and five will have their rents reduced by a third.The CVA proposed that 51 Byron sites keep the same rental costs, and five will have their rents reduced by a third.
A further 20 will have their rents reduced by 45% for six months while the group negotiates with landlords over the future of those sites.A further 20 will have their rents reduced by 45% for six months while the group negotiates with landlords over the future of those sites.
In total, Byron has 67 operating restaurants, and nine leases on non-operational sites.In total, Byron has 67 operating restaurants, and nine leases on non-operational sites.
As part of the restructuring process, investment house Three Hills Capital Partners will become the biggest shareholder by buying half of Hutton Collins' stake.As part of the restructuring process, investment house Three Hills Capital Partners will become the biggest shareholder by buying half of Hutton Collins' stake.
Mark Edwards, a partner at accountants BDO, argued that Byron had expanded too quickly.Mark Edwards, a partner at accountants BDO, argued that Byron had expanded too quickly.
"There is always a risk some of those sites will be marginal. However, the sector as a whole is struggling," he said."There is always a risk some of those sites will be marginal. However, the sector as a whole is struggling," he said.
"There are some operators that are more successful than others such as Honest Burger, which has a different take and is London-centric.""There are some operators that are more successful than others such as Honest Burger, which has a different take and is London-centric."
Mr Edwards said the restaurant sector was under increasing cost pressures including the National Living Wage, the apprenticeship levy, a squeeze on consumer spending, and higher import costs.Mr Edwards said the restaurant sector was under increasing cost pressures including the National Living Wage, the apprenticeship levy, a squeeze on consumer spending, and higher import costs.
Byron was founded in London in 2007 by the Gondola Group, which also owns the restaurant chains Ask, Pizza Express and Zizzi and sold to private equity group Hutton Collins Partners in October 2013 for £100m. Byron was founded in London in 2007 and sold to private equity group Hutton Collins Partners in October 2013 for £100m.
In July 2016 the firm attracted controversy after dozens of its staff were arrested in immigration raids.In July 2016 the firm attracted controversy after dozens of its staff were arrested in immigration raids.
Other retailers have recently sought CVAs.Other retailers have recently sought CVAs.
Jamie's Italian, the restaurant chain founded by celebrity chef Jamie Oliver, announced earlier this month that it wanted a CVA to help put the company on a firmer financial footing.Jamie's Italian, the restaurant chain founded by celebrity chef Jamie Oliver, announced earlier this month that it wanted a CVA to help put the company on a firmer financial footing.
Toys R Us UK successfully warded off the threat of administration in December when creditors backed its CVA plans, which led to the loss of 800 jobs and the closure of 26 stores.Toys R Us UK successfully warded off the threat of administration in December when creditors backed its CVA plans, which led to the loss of 800 jobs and the closure of 26 stores.