Cafe Rouge Owner Closes 91 Restaurants With Loss of 1,900 Jobs
(Bloomberg) -- The owner of the Bella Italia, Cafe Rouge and Las Iguanas chains has shut 91 outlets with the loss of 1,900 jobs after coronavirus lockdowns deepened a crisis in the U.K. restaurant business.
Casual Dining Group Ltd. said it had no choice other than entering administration, a form of insolvency in Britain, and shutting more than one-third of its 250 sites immediately to help it conclude rent negotiations with landlords while it tries to sell the remaining business.
The company, which employs 6,000 people overall, filed a notice of intention to appoint administrators in May, giving it some protection from creditors as it tried to find buyers. KKR & Co., the private-equity firm, bought Casual Dining Group in 2018.
Britain's mid-market dining sector has been hit hard by the lockdowns as sales plunged while costs such as rent and property taxes continued to accrue. Restaurants can reopen fully as of Saturday, but business is expected to suffer for some time. Other chains, including Italian-themed Carluccio's and burger brand Byron, are trying to find buyers.
“We needed to take this action in order to protect the business and secure the best possible future for Casual Dining Group as we look to conclude a potential sale,” Chief Executive Officer James Spragg said in a statement.
Alix Partners is handling the administration.
©2020 Bloomberg L.P.
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