A statement of the administrator’s proposal for Barby Ltd, the holding company for the grill and barbecue-focused group, reveals the company also owed £3.7m to HSBC Bank and approximately £3m to 150 unsecured creditors.
The group’s bank account was overdrawn when it fell in to administration, though it is anticipated HSBC will recover around £190,000 of its cash.
Barbecoa employed 166 members of staff, 78 of which were made redundant following the closure of its Piccadilly site in February. Jamie Oliver Holdings Ltd has agreed to provide funding to the administrators to settle the claims of redundant staff.
The St Paul’s site was bought back by One New Change Ltd, a subsidiary of the Jamie Oliver Restaurant Group, and continues to trade.
The report says the company incurred “significant losses” as a result of “expansion and increased competition”.
It adds that the group had entered in to an agreement for a lease at the Nova Victoria development, though it was never finalised.
The report says that the possibility of a CVA was explored prior to the company falling in to administration but it was dropped as it was thought it would not receive the required approval of 75% of its creditors.
“The Company’s restaurants have underperformed, particularly at the Piccadilly site, which has driven the vast majority of the Company’s recent trading losses,” the report says.
“The Company was forecast to remain loss making and was reliant upon head office support and additional funding from the wider Group.”
Possible buyers
Christie & Co was engaged on 4 February to market the two Barbecoa sites. The report says 141 parties registered interest in buying the restaurants, though they raised concerns over high occupancy costs, the size of the sites and refit costs.
M Restaurants founder Martin Williams previously announced to the press that he had approached the company over a possible purchase.
Two bids were received, including £295,000 for the St Paul’s site and stock from both restaurants from One New Change Ltd.
A second bid of £200,000 was received for the Piccadilly restaurant as a closed site with no business or employees.
The first bid was ultimately accepted as it was considered in line with the valuation of the site.
Oliver is also set to close 12 of his 37 Jamie’s Italian restaurants this year under a CVA.
Last month Jamie Oliver Restaurant Group CEO Jon Knight admitted the company had become “complacent” and had a “fight on its hands” to turn the business around after failing to innovate in the decade since its launch.