Administrators ‘on standby’ as Hostmore scrambles to sell UK restaurants
The Telegraph reports that administrators are ‘on standby’ after restructuring experts at Teneo were tasked with leading the hunt for potential buyers of TGI’s UK restaurants.
It follows Hostmore’s announcement earlier this month that it had abandoned its all-share acquisition of TGI Fridays in the US after the American group lost control of TGIF Funding, which holds legal title to the franchise agreement royalties and other various fees and revenue from intellectual property of the TGI Fridays business.
A deadline has been set at the end of the month for any asset sales that will help to repay the company’s main lenders, NatWest and HSBC.
However, Hostmore has already warned that any sale is expected to fall short of covering the group’s debts, meaning shareholders are unlikely to recover ‘any meaningful value’.
As a result, Hostmore’s board expects the company to be wound up and delisted from the London Stock Exchange following the completion of any sale process.
Industry sources have told The Telegraph that the prospect of finding a single buyer for the whole TGI UK estate, which also encompasses Fridays and Go, a fast casual offshoot of the TGI Fridays brand that has a single site in Dundee, is doubtful.
Rival chains may be tempted to cherry-pick stores in the most attractive locations, though, and company insiders have stressed that the TGI Fridays brand could survive if a new owner decided to take it on.
Hostmore was contacted by Restaurant but declined to comment.
