Coronavirus: Le Pain Quotidien cooks up partial rescue deal
Nearly 200 redundancies are expected to be made at the Belgian-owned bakery chain, Sky News understands.
Thursday 11 June 2020 17:15, UK
The British arm of the bakery chain Le Pain Quotidien has been sold in a deal which salvages jobs.
Sky News understands that two months of talks aimed at securing the future of the business have resulted in a transaction that will preserve 16 of Le Pain Quotidien's 26 UK sites.
The buyer is understood to be a subsidiary of BrunchCo21 SA, a newly formed company understood to be connected to Cobepa, a Belgian-based investment firm that is the chain's existing backer.
An announcement is likely before the weekend.
Sources said the deal was structured as a pre-pack administration overseen by Alvarez & Marsal, the professional services firm.
It is understood to involve the closure of LPQ's UK head office and ten of its restaurants, adding to the grim toll of job losses in the sector.
One source suggested that nearly 200 staff were expected to be made redundant following the pre-pack sale.
Talks with landlords about the lease arrangements on the remaining 16 sites are understood to be planned in the coming weeks.
The new owners are expected to invest additional sums in the UK business when the takeover completes, but further details of that investment are unclear.
BrunchCo, which is also in the process of acquiring LPQ's French and Belgian operations, is understood to have agreed a separate deal for M80, a Belgian private equity investor, to become its majority shareholder.
Its passage through insolvency makes Le Pain Quotidien the latest prominent casual dining business to be forced into administration by the COVID-19 pandemic.
About 1,000 jobs were lost at Carluccio's when parts of it were sold to the owner of the Giraffe restaurant chain, while both Casual Dining Group and Azzurri Group - the owners of Café Rouge and ASK Italian respectively - are battling for survival.
This week, The Restaurant Group confirmed that it would permanently close 125 sites, resulting in approximately 3000 job losses, as it pursues a company voluntary arrangement.
The closures largely relate to the Frankie & Benny's chain.
LPQ and A&M declined to comment on Thursday.